On April 25, 2008, Homeland Security Capital Corporation´s audit committee of the board of directors approved the engagement of Coulter & Justus P.C. as the Company´s new independent registered public accounting firm for the fiscal year ending December 31, 2008. CJ was formally retained by the Company on April 28, 2008. At that same meeting, the audit committee of the Company´s board of directors approved the dismissal of HJ & Associates, LLC (HJ) as its independent registered public accounting firm. The chairman of the Company´s audit committee provided notice to HJ of its dismissal on April 28, 2008.

Homeland Security Capital Corporation announced earnings results for the year ended December 31, 2007. Consolidated revenues increased to $12.6 million as compared to $6.7 million for the comparable period of 2006. Overall, the Company recorded a $2.9 million loss in 2007 as compared to a $6.5 million loss in 2006. The overall loss in 2007 includes a loss of $1.8 million from company´s debenture financing and derivative liability valuation adjustments and a gain of $1.6 million on sale of discontinued operations and the overall loss in 2006 includes a loss of $1.9 million concerning company´s debenture financing and derivative liability valuation adjustments and a loss of $1.4 million from discontinued operations.

Homeland Security Capital Corp. announced its results of operations for the year ending December 31, 2007. Consolidated revenues increased to $12.6 million for the twelve months ended December 31, 2007, as compared to $6.7 million for the comparable period of 2006. On March 19, 2008, the Company announced the acquisition of Safety & Ecology Holdings Corp. and the restructuring of its balance sheet, both as part of its ongoing effort to advance its business plan. The company said that the acquisition of Safety adds a scalable platform company which management believes will enable both organic growth and the opportunity to acquire complimentary companies in the industry.