U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

              [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                For the quarterly period ended September 30, 2005
                                       OR
                  [ ] TRANSITION REPORT PURSUANT TO SECTION 13
                 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
           For the transition period from ____________ to ____________


                    CONSORTIUM SERVICE MANAGEMENT GROUP, INC.
             (Exact name of registrant as specified in its charter)

    Texas                            0-27359                        74-2653437
--------------             ------------------------               --------------
  (state of                (Commission File Number)               (IRS Employer
incorporation)                                                      I.D. Number)

                   501 North Shoreline Drive, Suite 701 North
                            Corpus Christi, TX 78471
                                 (301) 887-7546
              ----------------------------------------------------
             (Address and telephone number of registrant's principal
               executive offices and principal place of business)

       Securities registered under Section 12(b) of the Exchange Act: None

         Securities registered under Section 12(g) of the Exchange Act:
                         Common Stock, $0.001 par value
                         ------------------------------
                                (Title of Class)

     Check  whether  the issuer (1) filed all  reports  required  to be filed by
Section 13 or 15(d) of the  Exchange  Act of 1934  during the past 12 months (or
for such shorter  period that the registrant was required to file such reports),
and (2) has been subject to such filing  requirements  for the past 90 days. Yes
[X] No [ ]

     As of November 17, 2005, the Company had 26,056,072 shares of its $.001 par
value common stock issued and outstanding.

     Indicate  by check mark  whether  the  registrant  is a shell  company  (as
defined in Rule 12b-2 of the Exchange Act. Yes [ ] No [X]

     Transitional Small Business Disclosure Format (check one): Yes [ ] No [X]

<PAGE>

                                TABLE OF CONTENTS
                                                                            Page
                                                                            ----

PART I - FINANCIAL INFORMATION                                                 3

Item 1.  Financial Statements                                                  3

Item 2.  Management's Discussion and Analysis or Plan of Operation            11

Item 3.  Controls and Procedures                                              15

PART II - OTHER INFORMATION                                                   15

Item 1.  Legal Proceedings                                                    15

Item 2.  Unregistered Sales of Securities                                     16

Item 6.  Exhibits and Reports on Form 8-K                                     17

SIGNATURES                                                                    21












                                       2
<PAGE>

                         PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

                                                                            Page
                                                                            ----

         Consolidated Balance Sheets September 30, 2005 (Unaudited)
                  and December 31, 2004                                        4
         Consolidated Statement of Operations (Unaudited)
                  September 30, 2005                                           6
         Consolidated Statement of Cash Flows (Unaudited)
                  September 30, 2005                                           7
         Consolidated Statement of Stockholders' Equity (Unaudited)
                  January 1, 2005 - September 30, 2005                         8
         Notes to the Financial Statements                                     9












                                       3
<PAGE>

                    CONSORTIUM SERVICE MANAGEMENT GROUP, INC.
                                AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS

                                     ASSETS

                                           Unaudited
                                          Sep 30, 2005    Dec 31, 2004
                                          ------------    ------------

Current Assets
Cash                                      $       --      $     88,908
                                          ------------    ------------
              Total Current Assets                --            88,908


Fixed Assets
Furniture and Equipment                         61,409          61,409
Less Accumulated Depreciation                  (61,409)        (61,409)
                                          ------------    ------------
              Total Fixed Assets                  --              --


Other Assets
Investment - United Engineering Company        170,809         224,134
Investment - CO2 Equipment                   1,619,446       1,470,881
Less Accumulated Depreciation                 (175,533)        (96,735)
Deposits                                         2,300            --
CO2 Equipment Patent                             8,000           8,000
Tissue Bonding Patent                          513,372         379,040
Less Accumulated Amortization                  (52,390)        (30,514)
                                          ------------    ------------
              Total Other Assets          $  2,086,004    $  1,954,806


              Total Assets                $  2,086,004    $  2,043,714
                                          ============    ============




                  The accompanying notes are an integral part
                     of these interim financial statements.


                                       4
<PAGE>
<TABLE>
<CAPTION>

                    CONSORTIUM SERVICE MANAGEMENT GROUP, INC.
                                AND SUBSIDIARIES

                     CONSOLIDATED BALANCE SHEETS (CONTINUED)

                                   LIABILITIES

                                                            Unaudited
                                                           Sep 30, 2005    Dec 31, 2004
                                                           ------------    ------------
<S>                                                        <C>             <C>
Current Liabilities
Bank Overdraft                                             $      6,713    $       --
Accounts Payable                                                610,812         317,683
Interest Payable                                              1,069,717         698,602
Payroll Taxes Payable                                            93,893          79,390
Notes Payable to Stockholders                                 4,206,869       3,852,564
CO2 Equipment Payable                                           206,749         206,749
Fee Debenture Payable                                              --           126,000
                                                           ------------    ------------
              Total Current Liabilities                       6,194,753       5,280,988

Long Term Liabilities
Long Term Contract IAW                                          300,000         300,000
Fee Debenture Payable                                              --           149,000
                                                           ------------    ------------
              Total Long-Term Liabilities                       300,000         449,000

              Total Liabilities                               6,494,753       5,729,988

Minority Interest in Consolidated Subsidiary                    206,000         206,000


        STOCKHOLDERS' EQUITY

Common stock $.001 par value, 40,000,000 shares
 authorized; 26,389,406 shares issued, 17,807,707
 shares outstanding, 8,500,986 shares subscribed
 at September 30, 2005; and 16,517,580 shares issued,
 13,268,591 shares outstanding, 3,168,276 shares
 subscribed at December 31, 2004                                 26,389          16,518
Additional Paid in Capital                                    7,309,763       6,721,052
 Less - Common Stock Subscriptions Receivable                    (8,501)         (3,168)
Accumulated Other Comprehensive (Loss)                         (337,919)       (343,027)
Accumulated (Deficit)                                       (11,572,196)    (10,251,364)
Treasury Stock                                                  (32,285)        (32,285)
                                                           ------------    ------------
              Total Stockholders' Equity                     (4,614,749)     (3,892,274)


              Total Liabilities and Stockholders' Equity   $  2,086,004    $  2,043,714
                                                           ============    ============
</TABLE>

                  The accompanying notes are an integral part
                     of these interim financial statements.


                                       5
<PAGE>
<TABLE>
<CAPTION>

                    CONSORTIUM SERVICE MANAGEMENT GROUP, INC.
                                AND SUBSIDIARIES
                                    Unaudited

                      CONSOLIDATED STATEMENT OF OPERATIONS

                                                        Jul 1, 2005-    Jul 1, 2004-    Jan 1, 2005-    Jan 1, 2004-
                                                        Sep 30, 2005    Sep 30, 2004    Sep 30, 2005    Sep 30, 2004
                                                        ----------------------------    ----------------------------
<S>                                                     <C>             <C>             <C>             <C>
Revenues                                                $       --      $       --      $        414    $       --

General and Administrative Expenses                          322,514         485,568       1,141,678       1,443,168
Funded R & D                                                    --
Cost of Funded R & D                                             210          84,799         121,195         165,473
Net R & D Cost                                                   210          84,799         121,195         165,473
                                                        ----------------------------    ----------------------------
            Operating (Loss)                                (322,724)       (570,367)     (1,262,459)     (1,608,641)

Interest Income                                                 --               119              60             130
Interest in Income (Loss) of Unconsolidated Companies         (9,823)         21,580         (58,433)        (20,300)
                                                        ----------------------------    ----------------------------
            (Loss) from Continuing Operations               (332,547)       (548,668)     (1,320,832)     (1,628,811)

Income Taxes                                                    --              --              --              --
            Net (Loss)                                  $   (332,547)   $   (548,668)   $ (1,320,832)   $ (1,628,811)
                                                        ============================    ============================

Net (Loss) Per Share Common Stock                              (0.02)          (0.04)          (0.08)          (0.14)
Weighted Average Common Shares Outstanding                15,592,685      12,764,890      17,185,574      11,589,765
</TABLE>




Basic and diluted  earnings  (loss) per share are the same.  The  corporation is
reporting  a net loss for the  reporting  periods and any  potentially  dilutive
securities are antidilutive (reduce net loss) and therefore not presented.




                  The accompanying notes are an integral part
                     of these interim financial statements.


                                       6
<PAGE>
<TABLE>
<CAPTION>

                    CONSORTIUM SERVICE MANAGEMENT GROUP, INC.
                                AND SUBSIDIARIES
                                    Unaudited

                      CONSOLIDATED STATEMENT OF CASH FLOWS

                                                                    Jan 1, 2005-    Jan 1, 2004-
                                                                    Sep 30, 2005    Sep 30, 2004
                                                                    ------------    ------------
<S>                                                                 <C>             <C>
Cash Flows from Operating Activities
------------------------------------
Net (Loss)                                                          $ (1,320,832)   $ (1,628,811)
Equity Loss from Investee                                                 58,433          20,300
Depreciation and Amortization                                            100,674          82,576
Pay Fee Debenture                                                        126,000         320,000
Services and Interest for Common Stock                                     6,500         244,089
Increase (Decrease) Current Liabilities                                   57,103        (130,423)
Increase Accrued Interest                                                371,114         317,899
                                                                    ------------    ------------
              Net Cash provided by (used in) Operating Activities       (601,008)       (774,370)


Cash Flows from Investing Activities
------------------------------------
Deposits                                                                  (2,300)           --
Purchase Equipment and Patent                                           (282,896)       (102,386)
                                                                    ------------    ------------
              Net Cash (used in) Investing Activities                   (285,196)       (102,386)


Cash Flows from Financing Activities
------------------------------------
Bank Overdraft                                                             6,713            --
Increase Notes Payable                                                   205,305         637,591
Increase Stock Issue                                                     585,278         355,613
                                                                    ------------    ------------
              Net Cash provided by Financing Activities                  797,296         993,204


Net Increase (Decrease) in Cash and Cash Equivalents                     (88,908)        116,448

Cash and Cash Equivalents at Beginning of Period                          88,908          13,118
                                                                    ------------    ------------
Cash and Cash Equivalents at End of Period                          $       --      $    129,566
                                                                    ============    ============
</TABLE>

                  The accompanying notes are an integral part
                     of these interim financial statements.


                                       7
<PAGE>
<TABLE>
<CAPTION>

                    CONSORTIUM SERVICE MANAGEMENT GROUP, INC.
                                AND SUBSIDIARIES
                                    Unaudited

                 CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                      JANUARY 1, 2005 - SEPTEMBER 30, 2005



                                                                         Additional
                                       No. Common           Par            Paid In            Stock
Description                           Shares (Ea.)         Value           Capital         Subscribed
------------------------------------------------------------------------------------------------------
<S>                                   <C>             <C>              <C>              <C>
Balance January 1, 2005                 16,517,580    $       16,518   $    6,721,052   $       (3,168)
Common Stock Sold                        3,056,603             3,057          582,221             --
Common Stock Issued for Services            10,000                10            6,490             --
Common Stock Issued for Interest              --                --               --               --
Common Stock Issued for Notes                 --                --               --               --
Common Stock Escrowed/Subscribed         6,805,223             6,804             --             (5,333)
Net (Loss)                                    --                --               --               --
Other Comprehensive Income (Loss)             --                --               --               --
Foreign Exchange Gain (Loss)                  --                --               --               --
------------------------------------------------------------------------------------------------------
Balance Sep 30, 2005                    26,389,406    $       26,389   $    7,309,763   $       (8,501)
                                      ================================================================
Treasury Shares                            (80,713)
Shares Subscribed                       (8,500,986)
                                      ------------
Shares Outstanding                      17,807,707
                                      ============


                                        Accumulated
                                           Other
                                       Comprehensive      Accumulated        Treasury
Description                            Income (Loss)        Deficit            Stock             Total
----------------------------------------------------------------------------------------------------------
Balance January 1, 2005               $     (343,027)   $  (10,251,364)   $      (32,285)   $   (3,892,274)
Common Stock Sold                               --                --             585,278
Common Stock Issued for Services                --                --               6,500
Common Stock Issued for Interest                --                --                --                --
Common Stock Issued for Notes                   --                --                --                --
Common Stock Escrowed/Subscribed                --                --                --               1,471
Net (Loss)                                      --          (1,320,832)             --          (1,320,832)
Other Comprehensive Income (Loss)               --                --                --                --
Foreign Exchange Gain (Loss)                   5,108              --                --               5,108
----------------------------------------------------------------------------------------------------------
Balance Sep 30, 2005                  $     (337,919)   $  (11,572,196)   $      (32,285)   $   (4,614,749)
                                      ====================================================================
</TABLE>

                  The accompanying notes are an integral part
                     of these interim financial statements.


                                       8
<PAGE>

                    CONSORTIUM SERVICE MANAGEMENT GROUP, INC.
                                AND SUBSIDIARIES
                          NOTES TO FINANCIAL STATEMENTS
                      SEPTEMBER 30, 2005, DECEMBER 31, 2004

                                     NOTE 1
                              BASIS OF PRESENTATION

The accompanying  unaudited interim consolidated  financial statements have been
prepared  in  accordance  with  standards  established  by  the  Public  Company
Accounting Oversight Board (United States). Accordingly, they do not include all
of the  information  and  footnotes  required by generally  accepted  accounting
principles for complete financial statements. In the opinion of management,  all
adjustments  considered  necessary for a fair  presentation  have been included.
Operating  results for the nine month period  ending  September 30, 2005 are not
necessarily  indicative  of the results  that may be expected for the year ended
December  31,  2005.  For  further  information,  refer  to the  audited  annual
consolidated  financial  statements  and  footnotes  thereto  for the year ended
December 31, 2004.

                                     NOTE 2
                                  GOING CONCERN

The Company's financial statements have been presented on the basis that it is a
going concern, which contemplates the realization of assets and the satisfaction
of liabilities in the normal course of business. The Company incurred a net loss
of  ($1,320,832)  for the nine months ended September 30, 2005 and when combined
with prior year net losses  raises doubt as to the  Company's  ability to obtain
debt and/or equity financing and achieve  profitable  operations.  Additionally,
during the third quarter 2005 the Internal  Revenue  Service filed a federal tax
lien on the Company for $93,217.

The Company's  management  intends to raise  additional  operating funds through
equity and/or debt offerings and the development and marketing of  technologies.
However,  there  can  be no  assurance  management  will  be  successful  in its
endeavors.  The possible  consequences of not obtaining  additional funds either
through equity offerings,  debt offerings, or sale of technologies is that there
will not be sufficient money to fund the capital projects  required to earn long
term planned revenues of the Company.

The  Company's  ability to continue as a going  concern also involves the carbon
dioxide  separator  equipment  which is  currently  inactive  due to  litigation
between the prior gas owner and the landfill  operator.  CSMG was not a party to
this  litigation  but  reached  agreement  with the prior  landfill  gas owner's
bankruptcy  trustee in February of 2005.  The  agreement  was appealed by one of
prior gas owner's insider creditors  causing  additional  delays.  The technical
problems  as  stated  in Note 1 under  Significant  Accounting  Policies  on the
December 31, 2004 audited annual  consolidated  financial  statements relates to
the national  pipeline gas  specification  standard of .2% oxygen and a total of
3.0% CO2,  oxygen and  nitrogen.  Other gases such as  nitrogen  and oxygen in a
landfill  project is a function of managing the gas  gathering  system to reduce
the inflow of air.  Although the company has the technology to  manufacture  the
additional nitrogen and oxygen removal systems to meet these specifications at a
cost of $200,000 to $300,000,  the Company is currently  negotiating  with three
large industrial  plants within seven (7) miles of the Chastang location that do
not need  national  pipeline  quality gas and only require 83% and above methane
purity to fire boilers.  This  eliminates  the immediate need for the additional
oxygen and nitrogen removal  equipment at the Chastang plant. It should be noted
that there are a number of landfill gas to customer  projects  that deliver only
50% and above  methane  purity  that  never  reach the level of purity  that the
Company's  CO2  separator  reaches  without the  additional  nitrogen and oxygen
removal  systems.  Additionally,  the  Company's CO2 separator has an efficiency
rating of  processing  and  delivering  over 97% of methane  that enters the CO2
separator system.  This compares with 80% to 85% efficiency rating for other CO2
separation  systems.  The technology has been successfully  installed on similar
equipment in Eastern Europe and with management  continually  monitoring the CO2
project  the  equipment  is being  carried  at its  original  cost  less  normal
depreciation with projected cash flows still considered  adequate to recover the
net book value  including  upgrades if the equipment  becomes  operational.  The
resolution  of the  above  mentioned  issues is  necessary  for the  Company  to
continue as a going concern.


                                       9
<PAGE>

                                     NOTE 3
                    INCOME (LOSS) FROM UNCONSOLIDATED COMPANY

The  Company's  33%  owned  subsidiary  United  Engineering  Company,  a Ukraine
company, reported the following sales, gross profits and net (loses):

                      Jul 1, 2005-   Jul 1, 2004-  Jan 1, 2005-   Jan 1, 2004-
                      Sep 30, 2005   Sep 30, 2004  Sep 30, 2005   Sep 30, 2004
                      ------------   ------------  ------------   ------------
Sales                 $    187,349   $    290,108  $    627,400   $    747,528
Gross Profit (Loss)         25,604        117,960        (9,478)       117,960
Net (Loss)                 (29,469)        64,740      (175,300)       (60,900)
CSMG's 1/3 (Loss)           (9,823)        21,580       (58,433)       (20,300)












                                       10
<PAGE>

Item 2.  Management's Discussion and Analysis of Financial Condition and Results
of Operations

     The following  discussion and analysis  should be read in conjunction  with
the financial statements and the accompanying notes thereto for the period ended
September 30, 2005 and is qualified in its entirety by the foregoing and by more
detailed  financial  information  appearing  elsewhere.  See "Item 1.  Financial
Statements."

     Results of  Operations - Third Quarter of 2005 Compared to Third Quarter of
     ---------------------------------------------------------------------------
     2004
     ----

     We had no revenues either for Q3 2005 or Q3 2004.

     Operating  expenses  decreased  by  $247,643  to  $322,724  during  Q3 2005
compared to $570,367 in Q3 2004. The decrease is attributable primarily to costs
attributed to reduced financing fees, tissue welding expense,  and CO2 separator
expense.

     We had a loss  from  operations  of  $322,724  for Q3 2005  compared  to an
operating  loss of $570,367  for Q3 2004.  The  decrease is due to a decrease in
operating expenses.

     We  accrued a loss in Q3 2005 of $9,823  from our joint  venture in Ukraine
with United  Engineering  Company,  as compared  with an accrued gain of $21,580
from this activity in Q3 2004.  The decrease of $31,403 is attributed to reduced
sales by United Engineering Company. See Note 3 to the financial statements.

     Our net loss for Q3 2005 was $332,547, or $0.02 a share, as compared with a
net loss in Q3 2004 of $548,668,  or $0.04 a share, a decrease  attributable  to
decreased expenses.

     We were able to remain liquid during this quarter  through (1) funding from
our Cornell Capital Standby Equity Distribution Agreement and (2) an increase of
$205,305 in our Notes Payable.

     On March 29, 2004, we entered into an Equity Line of Credit  Agreement with
Cornell Capital Partners. Under this agreement, we may issue and sell to Cornell
Capital  Partners  common stock for a total purchase price of up to $10 million.
Subject to certain  conditions,  we are entitled to draw down on the Equity Line
of Credit now that the common stock to be issued under the Equity Line of Credit
is registered with the Securities and Exchange  Commission and the  registration
statement is declared  effective.  The purchase price for the shares is equal to
95% of, or a 5% discount  to, the market  price,  which is defined as the lowest
closing bid price of the common stock during the five trading days following the
notice  date.  We have the right,  but not the  obligation,  to require  Cornell
Capital to  purchase  shares in the  company's  common  stock in amounts  not to
exceed  $140,000  per draw up to a maximum of $420,000 per month with a total of
$10 million over a consecutive  24-month  period.  Cornell Capital Partners will
receive a fee  debenture of  $390,000,  in the form of  convertible  debentures.
Cornell will also receive a $10,000  legal fee of which $5,000 has been paid and
the balance will be paid from the proceeds  from the initial  advance  under the
Equity Line of Credit.  Cornell Capital  Partners is entitled to retain a fee of


                                       11
<PAGE>

5% of each  advance.  The net effect of the 5% discount  and the 5% retainage of
each advance is that Cornell Capital Partners shall pay 90.25% of the applicable
closing  bid price for each  share of our common  stock.  In  addition,  we have
entered into a placement agent agreement with Newbridge Securities, a registered
broker-dealer. Pursuant to the placement agent agreement, we will pay a one-time
placement  agent fee in shares of common  stock equal to  approximately  $10,000
based on the stock price on the date we agreed to engage the placement agent.

     We received  $1,800,000 under a loan agreement with Cornell in July, August
and  December  2004 and January and March 2005 which is being repaid at the rate
of $20,000 per week through the Cornell Equity Line of Credit  Agreement.  These
funds were used for operations of the parent and subsidiaries.

     As of September 30, 2005 we have sold  6,420,056  shares of common stock to
Cornell  Capital for $1,800,000  pursuant to the Equity Line of Credit.  We have
escrowed  6,805,223  shares with  Cornell's  escrow agent to use as repayment of
current credit line balance and future credit line use.

     Results of  Operations  - First Nine Months of 2005  Compared to First Nine
     ---------------------------------------------------------------------------
     Months of 2004
     --------------

     We had  revenues of only $414 during the nine months  ended  September  30,
2005 and no revenues in the first nine months of 2004.

     Operating  expenses of  $1,262,459 in the first nine months of 2005 were 78
percent of those of the first nine months of 2004 - $1,608,641.  The decrease of
$346,182 is primarily  attributable to financing  fees, and lowered  expenses in
the tissue welding and CO2 projects.

     We had an operating  loss of $1,262,459 in the first nine months of 2005 as
compared with an operating loss in the first nine months of 2004 of $1,608,641 -
a 22 percent  decrease  attributable to financing fees, and lowered  expenses in
the tissue welding and CO2 projects.

     We recorded accrued losses of $58,433 in the first nine months of 2005 from
our Ukraine joint venture operations in United Engineering Company,  compared to
an accrued  loss of $20,300 in the first nine months of 2004.  This  increase of
$38,133 in loss is attributed to lower sales by United Engineering  Company. See
Note 3 to the financial statements.

     Taking into account our joint venture  operations in Ukraine,  we had a net
loss of  $1,320,832,  or $0.08 a share in the first nine months of 2005 compared
with a net loss of  $1,628,811,  or $0.14 a share,  in the first nine  months of
2004.  Nevertheless,  we feel that we are on the right  course for the  company,
that our CO2  separator  project and our human  tissue  bonding/welding  project
still hold considerable promise for our company in 2005.


                                       12
<PAGE>

     Overview
     --------

     CO2 Separator.  The status of our CO2 separator project in Chastang County,
Alabama is that the installation  was completed during March 2003.  Start-up and
equipment  adjustment  were delayed  while waiting for the landfill gas owner to
complete installation of the end-user pipeline and gas metering system. This was
installed  near the end of March  just as our  Ukraine  supervisory  team had to
return to Ukraine. In addition, the landfill gas quality was well below expected
levels and required  repairs to the gas  gathering  system to reduce air intake.
The landfill gas owner  coordinated  and completed these repairs during the next
few  weeks,  finishing  toward  the end of May.  The  Ukraine  supervisory  team
returned in early June to oversee  service,  start-up and adjust the  equipment.
Poor weather caused some delays but this was completed in about two weeks. As we
prepared to begin start-up operations and equipment adjustment, Waste Management
Inc.  ("WMC",  the  operator  of  the  landfill)  ordered  Resource   Technology
Corporation  "RTC" (the holder of the gas  ownership  contract) off the landfill
and contended that our CO2 separator  equipment  produces methane gas that fails
to meet gas quality specifications and that, therefore, the agreement to buy the
gas is  terminated.  This  contention  was  resolved  in the  RTC's  chapter  11
reorganization  proceeding  and CSMG has  executed  a contract  with WMC.  It is
possible that our gas collection  and conversion  systems could be determined to
be out of specifications for national pipeline specifications thus necessitating
installing  upgrades  estimated to cost between  $200,000 and $300,000 to enable
the equipment to meet the gas quality requirements. This relates to the national
pipeline  gas  specification  standard  of .2%  oxygen  and a total of 3.0% CO2,
oxygen and nitrogen.  The presence of other gases such as nitrogen and oxygen in
a landfill  project is a function of managing the gas gathering system to reduce
the inflow of air.  Although the company has the technology to  manufacture  the
additional nitrogen and oxygen removal systems to meet these specifications at a
cost of $200,000 to $300,000,  the Company is currently  negotiating  with three
large industrial  plants within seven miles of the Chastang location that do not
need national pipeline quality gas and only require 83% and above methane purity
to fire boilers.  This  eliminates the immediate need for the additional  oxygen
and nitrogen  removal  equipment at the Chastang  plant. It should be noted that
there are a number of landfill  gas to customer  projects  that deliver only 50%
and above methane purity that never reach the level of purity that the Company's
CO2  separator  reaches  without  the  additional  nitrogen  and oxygen  removal
systems.  Additionally,  the Company's CO2 separator has an efficiency rating of
processing  and  delivering  over 97% of methane  that enters the CO2  separator
system. This compares with 80% to 85% efficiency rating for other CO2 separation
systems.  Currently  the Company has a caretaker at the landfill to maintain the
equipment.   If  additional  funds  are  required  to  upgrade  the  system  the
possibility  remains  that the  process  will  still  not meet  the  Mobile  Gas
specifications  and if so it will be  necessary to move the  equipment  from the
Chastang landfill.  Should this occur it is unclear if any future carbon dioxide
projects will be possible and if so the continued  existence of the Company will
depend on live tissue bonding and anaerobic farm waste technology sales.

     Live Tissue  Bonding.  The status of our tissue bonding  project is clouded
somewhat by recent  events.  We have started the  development  of equipment from
prototype model to a commercial  model.  The equipment bonds the soft biological
tissue with a special  miniature  surgical tool. No glues,  sutures,  staples or
other  foreign  matter  are used.  The  process is best  described  as a welding
process.  The scar tissue is either minimal or non-existent.  Tests conducted in


                                       13
<PAGE>

Louisville,  Kentucky by U.S.  surgeons on  rabbits'  stomachs  resulted in scar
tissue only forty  microns  wide six months after  surgery.  It appears that the
Ukraine  scientists have developed a superior,  all-purpose,  seamless method of
bonding  soft  biological  tissues,  which  method  is  characterized  by simple
manipulation   applicable  to  different   surgical   operations  and  the  fast
restoration of tissues without the formation of coarse scars.  Apparently  there
is no need for prolonged special training of surgeons and surgical personnel.

     In 2002 we formed  Live  Tissue  Connect,  Inc.,  a  Delaware  corporation,
through  which we propose to develop our Tissue  Bonding  technology.  We own 86
percent of Live Tissue Connect, Inc.

     We estimate  that in excess of $2 million have been  expended in developing
the project and that $2.5 million of additional  funds must be expended to bring
this product to market.  The first surgical  equipment  could be manufactured in
the U.S.  during the next 12 months now that the U.S.  patent  applications  are
approved and patents are issued.

     This project is still in the development  stage, even though the Ukrainians
have  created a  finished  product in their  special  miniature  surgical  tool.
Improvements  in the tool are possible,  and testing on live tissue of humans to
U.S. testing standards is required. Approval of the process and equipment by the
Federal Drug Administration is required.

     On March 8, 2005 our majority-owned subsidiary,  Live Tissue Connect, Inc.,
entered into a Joint  Development  and Exclusive  License  Agreement with ConMed
Corporation.  On May 31, 2005 the agreement  terminated by its terms.  There was
and is no material relationship between our company or its affiliates and ConMed
Corporation other than in respect of the agreement.

     The Agreement  provided for an exclusive  world-wide  product licensing and
marketing agreement (subject to due diligence) with ConMed  Corporation,  Utica,
N.Y. to bring Live Tissue  Connect's  patented  platform live biological  tissue
bonding/welding technology to the United States and world markets.

     The agreement  provided that if ConMed had not  communicated to Live Tissue
Connect ConMed's satisfaction with further due diligence review on or before May
31, 2005,  then the Agreement would have no binding effect upon either party and
both parties would thereupon be released from all liabilities hereunder.

     ConMed did not communicate,  to Live Tissue Connect,  ConMed's satisfaction
with further due diligence  review on or before May 31, 2005.  So, the agreement
terminated by its own provisions.  No termination penalties were incurred by our
company or its subsidiary, Live Tissue Connect.

     Anaerobic  Farm Waste  Project.  With  regard to our  anaerobic  farm waste
project  we have  not  been  successful  in  developing  contracts.  We have met
resistance  from  swine,  dairy and  poultry  farmers in our efforts to sell our
anaerobic  farm waste plant,  due to the long period of time  required for small
farms to recover  the costs of the plant and due to falling  producer  prices in
these industries.


                                       14
<PAGE>

     The company's  future results of operations  and the other  forward-looking
statements   contained   in  this   Outlook   involve  a  number  of  risks  and
uncertainties.  Among the  factors  that could  cause  actual  results to differ
materially  are  the  following:  inability  of the  company  to  obtain  needed
additional  capital,  loss of personnel - particularly  Chief Executive  Officer
Donald S.  Robbins or other key  executives  as result of accident or for health
reasons,  interruptions  in the supply of equipment  from  manufacturers  of the
equipment,   the   development   of  competing   products  by   well-capitalized
competitors,  and an accident  involving life or serious bodily harm that fairly
or  unfairly  would  bring  into  question  the  safety of using  the  company's
products.

Off-Balance Sheet Arrangements

     Our  company  has not  entered  into any  transaction,  agreement  or other
contractual  arrangement  with an entity  unconsolidated  with us under which we
have

o    an obligation under a guarantee contract,
o    a  retained  or   contingent   interest  in  assets   transferred   to  the
     unconsolidated  entity  or  similar  arrangement  that  serves  as  credit,
     liquidity or market risk support to such entity for such assets,
o    any obligation,  including a contingent  obligation,  under a contract that
     would be accounted for as a derivative instrument, or
o    any  obligation,  including  a  contingent  obligation,  arising  out  of a
     variable  interest  in an  unconsolidated  entity  that  is  held by us and
     material to us where such entity provides financing, liquidity, market risk
     or credit risk  support to, or engages in leasing,  hedging or research and
     development services with us.

Item 3.  Controls and Procedures

     Evaluation of disclosure controls and procedures.  The Company's management
believes  internal controls are as good as practical given the limited resources
of the company.

                           PART II - OTHER INFORMATION

Item 1.  Legal Proceedings.

     We were  sued on  February  10,  2005 by Banco  Panamericano,  Inc.  in the
Circuit Court of Cook County, Illinois,  Banco Panamericano,  Inc. v. Consortium
Service Management Group, Inc. and CSMG Gastech, LLC, Case No. 2005L001614.  The
complaint  alleges  that we  entered  into a  short-term  promissory  note dated
February  15,  2002 ("the  Note") by which we borrowed  from Banco  Panamericano
$203,800  at 12%  interest,  the Note  being due April 1,  2002.  The  complaint
alleges that the Note was secured by all of our equipment,  inventory, accounts,
general intangibles and other properties. The complaint alleges that the Note is
in default and that we owe Banco Panamericano $514,920 as of February 9, 2005.

     We allege as follows with regard to the allegations of Banco Panamericano:


                                       15
<PAGE>
<TABLE>
<CAPTION>

o    Banco  Panamericano  is not a  bank  but a  Nebraska  corporation  that  is
     affiliated with Resource  Technologies  Corporation ("RTC"), a company that
     is a debtor in a federal chapter 11 reorganization case.

o    We and RTC had entered into a contract  ("the  Contract")  whereby we would
     provide  equipment ("the  Equipment"),  at our cost, to filter landfill gas
     from a  landfill  operated  by RTC  located  in  Alabama  so as to  provide
     marketable  methane gas. Among RTC's  obligations  under the Contract was a
     commitment to provide a pipeline hookup to the purchaser of the gas. We and
     RTC would share in the proceeds from the sale of the methane gas.

o    We lacked the funds to perform our obligations under the Contract.  RTC got
     its affiliate, Banco Panamericano, to agree to lend CSMG $203,800 to enable
     us to meet  these  obligations.  It was  understood  by us,  RTC and  Banco
     Panamericano  that  CSMG  would  liquidate  the Note  from its share of the
     proceeds of sale of the methane gas.

o    We installed the Equipment.  But RTC never performed its obligations  under
     the  Contract.  No monies were ever advanced by Banco  Panamericano  to us;
     rather,  funds  were  allegedly  advanced  by  Banco  Panamericano  to  its
     affiliate, RTC, while RTC was in bankruptcy proceedings - ostensibly to pay
     expenses  incurred  by CSMG in  installing  its  Equipment  pursuant to its
     Contract with RTC.  However,  many of such creditors were not paid and many
     checks issued by RTC were  ultimately  dishonored,  all to the injury of us
     and  contrary  to  the  terms  of  the  agreement   between  us  and  Banco
     Panamericano.

     We believe that we, not the plaintiff,  are the injured party and that this
litigation  properly  belongs in RTC's  chapter 11  proceedings  in the  federal
bankruptcy  court.  We are  taking  court  action  to  remove  the  case  to the
bankruptcy  court  and to seek  damages  against  RTC and its  affiliate,  Banco
Panamericano.  The case has been moved from the  Circuit  Court of Cook  County,
Illinois to the United States District Court,  Eastern Division for the Northern
District  of  Illinois.  The matter  remains  pending  before the United  States
District Court which will rule before December 15, 2005.

Item 2.  Unregistered Sales of Equity Securities

     Set forth  below are the sales of our  common  stock  since July 1, 2005 in
transactions  exempt from registration  pursuant to the provisions of Regulation
D, Rule 506

          ---------- ------------------------------------ ---------- ----------- ---------------
<S>                  <C>                                  <C>        <C>         <C>
                                                          No. of     Price       Type of
          Date       Person                               Shares     Per Share   Consideration
          ---------- ------------------------------------ ---------- ----------- ---------------
          08-30-05   John B. Sohocki, II and Deborah M.   100,000    $0.06       Cash
                     Sohocki, tenants in common
          ---------- ------------------------------------ ---------- ----------- ---------------
          08-30-05   Robert Machen                        183,333    $0.06       Cash
          ---------- ------------------------------------ ---------- ----------- ---------------
          08-30-05   Don Early                              83,333   $0.06       Cash
          ---------- ------------------------------------ ---------- ----------- ---------------
          08-30-05   Charles Schoen                       250,000    $0.06       Cash
          ---------- ------------------------------------ ---------- ----------- ---------------
          08-30-05   John Durham                          100,000    $0.06       Cash
          ---------- ------------------------------------ ---------- ----------- ---------------
</TABLE>

     All of the  persons  purchasing  shares  of  common  stock  were  known  to
management, they were all accredited investors


                                       16
<PAGE>

Item 6.  Exhibits  and  Reports  on  Form  8-K

     (a)  Exhibits

     The following exhibits are filed, by incorporation by reference, as part of
this Form 10-QSB:

Exhibit No.                                Description
-----------                                -----------

    3        -      Amended and Restated Articles of Incorporation of Consortium
                    Service Management Group, Inc.*

    3.1      -      Bylaws of Consortium Service Management Group, Inc.*

   10        -      Founders' Agreement of United Engineering Company*

   10.1      -      Statutes (Bylaws) of United Engineering Company*

   10.2      -      Agreement  of April  24,  1996  between  Consortium  Service
                    Management  Group,  Inc.  and The L Group,  Inc.  concerning
                    tissue bonding technology* (rescinded in January 2000)

   10.3      -      Agreement  of  July  9,  1996  between   Consortium  Service
                    Management Group, Inc. and International  Welding concerning
                    tissue bonding technology*

   10.4      -      Agreement among Consortium  Service  Management Group, Inc.,
                    United  Engineering  Company  and  Ivan  V.  Semenenko,  the
                    inventor of the anaerobic farm waste technology*

   10.5      -      Agreement   of  June  9,  1998  among   Consortium   Service
                    Management  Group,  Inc., The Sumy Frunze  Machine  Building
                    Science and Production  Association,  and United Engineering
                    Company concerning the anaerobic farm waste technology*

   10.6      -      Agreement between  Consortium Service Management Group, Inc.
                    and Western Waste Management,  Inc. concerning the anaerobic
                    farm waste technology*

   10.7      -      Agreement between  Consortium Service Management Group, Inc.
                    and  Aardema  Dairy  concerning  the  anaerobic  farm  waste
                    technology*


                                       17
<PAGE>

   10.8      -      Agreement between  Consortium Service Management Group, Inc.
                    and John and Ruth  Beukers  concerning  the  anaerobic  farm
                    waste technology*

   10.9      -      Agreement  of December  1998 between  International  Welding
                    Association  of  Kiev,   Ukraine  and   Consortium   Service
                    Management  Group,   Inc.   concerning  the  carbon  dioxide
                    separator technology*

   10.10     -      Operating  Agreement  of June 14,  2001  between  Consortium
                    Service  Management  Group,  Inc.  and  Resource  Technology
                    Corporation***

   10.11     -      Contract   Agreement   Effective  August  14,  2000  between
                    Consortium Service Management Group/Anaerobic Farm Waste Co.
                    and Rondeau Anaerobic***

   10.12     -      Contract  IAW-USA  002-PR-19.04.2000  between  International
                    Association  Welding,  Kiev and E.O. Paton Electric  Welding
                    Institute  National  Academy  Science Ukraine and Consortium
                    Service Management Group, Inc.***

   10.13     -      Contract  IAW-USA  003-PR-19.04.2000  between  International
                    Association  Welding,  Kiev and E.O. Paton Electric  Welding
                    Institute  National  Academy  Science Ukraine and Consortium
                    Service Management Group, Inc.***

   10.14     -      Contract  IAW-USA  004-PR-19.04.2000  between  International
                    Association  Welding,  Kiev and E.O. Paton Electric  Welding
                    Institute  National  Academy  Science Ukraine and Consortium
                    Service Management Group, Inc.***

   10.15     -      Contract  IAW-USA  005-PR-19.04.2000  between  International
                    Association  Welding,  Kiev and E.O. Paton Electric  Welding
                    Institute  National  Academy  Science Ukraine and Consortium
                    Service Management Group, Inc.***

   10.16     -      Contract  IAW-USA  006-PR-19.04.2000  between  International
                    Association  Welding,  Kiev and E.O. Paton Electric  Welding
                    Institute  National  Academy  Science Ukraine and Consortium
                    Service Management Group, Inc.***


                                       18
<PAGE>

   10.17     -      Contract  IAW-USA  007-PR-19.04.2000  between  International
                    Association  Welding,  Kiev and E.O. Paton Electric  Welding
                    Institute  National  Academy  Science Ukraine and Consortium
                    Service Management Group, Inc.***

   10.18     -      Contract  IAW-USA 008-PR between  International  Association
                    Welding,  Kiev,  Ukraine and Consortium  Service  Management
                    Group, Inc.***

   10.19     -      Natural Gas  Purchase  Agreement  of June 20,  2000  between
                    Texas Energy Transfer Company,  Ltd. and Resource Technology
                    Corp.****

   10.20     -      Agency  Agreement  between  Joint Stock Company "Sumy Frunze
                    Machine-Building  Science  and  Production  Association"  of
                    Ukraine and Consortium Service Management Group, Inc.+

   10.21     -      2003 Stock  Option Plan adopted by the board of directors of
                    Consortium Service Management Group, Inc.++

   10.22     -      Joint  Development and Exclusive  License Agreement of March
                    8,  2005  between  Live  Tissue  Connect,  Inc.  and  ConMed
                    Corporation.+*

   10.23     -      Standby  Equity  Distribution  Agreement  of March __,  2004
                    between Cornell Capital Partners,  LP and Consortium Service
                    Management Group, Inc.++*

   14        -      Code of Ethics for the Chief  Executive  Officer  and Senior
                    Financial Officers.++*

   16        -      Letter  dated  January 29,  2000 from Jaak  (Jack)  Olesk to
                    Consortium Service Management Group, Inc. Re: Termination as
                    Auditor**

   31        -      Certification  of Chief  Executive  Officer  pursuant  to 18
                    U.S.C.  Section 1350, as adopted  pursuant to Section 302 of
                    the Sarbanes-Oxley Act of 2002.

   31.1      -      Certification  of Chief  Financial  Officer  pursuant  to 18
                    U.S.C.  Section 1350, as adopted  pursuant to Section 302 of
                    the Sarbanes-Oxley Act of 2002.


                                       19
<PAGE>

   32        -      Certification  of Chief  Executive  Officer  pursuant  to 18
                    U.S.C.  Section 1350, as adopted  pursuant to Section 906 of
                    the Sarbanes-Oxley Act of 2002.

   32.1      -      Certification  of Chief  Financial  Officer  pursuant  to 18
                    U.S.C.  Section 1350, as adopted  pursuant to Section 906 of
                    the Sarbanes-Oxley Act of 2002.

   99        -      Ukraine Ministry of Health, State Department, Certificate of
                    State Registration No. 1105-193***

   99.1      -      Extract of U.S. Patent No. 6,562,037 May 13, 2003.+++

   99.2      -      Extract of U.S. Patent No. 6,733,498 May 11, 2004.+++


*Previously  filed with Form 10-SB;  Commission  File No.  0-27359  incorporated
herein.

**Previously  filed with  Amendment  No. 1 to Form  10-SB;  Commission  File No.
0-27359 incorporated herein.

***Previously  filed with  Amendment  No. 2 to Form 10-SB;  Commission  File No.
0-27359 incorporated herein.

****Previously  filed with  Amendment  No. 1 to Form 10-QSB for the period ended
September 30, 2002; Commission File No. 0-27359 incorporated herein.

+Previously  filed  with Form  10-KSB  for the year  ended  December  31,  2002;
Commission File No. 0-27359 incorporated herein.

++Previously  filed with  Amendment  No. 1 to Form  10-QSB for the period  ended
March 31, 2003; Commission File No. 0-27359 incorporated herein.

+++Previously  filed  with Form  10-QSB  for the  period  ended  June 30,  2004;
Commission File No. 0-27359 incorporated herein.

+*Previously  filed with Form 8-K (Date of Report March 8, 2005) filed 03-09-05,
Commission File No. 0-27359 incorporated herein.

++*Previously  filed with Form  10-KSB for the year ended  12-31-04,  Commission
File No. 0-27359 incorporated herein.





                                       20
<PAGE>

                                   SIGNATURES

In accordance with the  requirements of the Exchange Act, the registrant  caused
this  report to be  signed on its  behalf  by the  undersigned,  thereunto  duly
authorized.

Dated:  November 21, 2005                          CONSORTIUM SERVICE MANAGEMENT
                                                              GROUP, INC.



                                                By: /s/ Donald S. Robbins
                                                   -----------------------------
                                                   Donald S. Robbins, President