SecProbe.io

<DOCUMENT>
<TYPE>LETTER
<SEQUENCE>1
<FILENAME>filename1.txt
<TEXT>
								June 24, 2005

Ms. Jacqueline Danforth
President, Principal Executive, Financial and Accounting Officer
FACT Corporation
915 Timber Ridge Court
Neptune, NJ 07753

	Re:	FACT Corporation
		Form 10-KSB for the Fiscal Year Ended December 31, 2004
Filed April 15, 2005
      File No. 000-17232

Dear Ms. Danforth:

      We have reviewed your Form 10-KSB for the fiscal year ended
December 31, 2004 and have the following comments.  We have
limited
our review to only your financial statements and related
disclosures
and do not intend to expand our review to other portions of your
documents.  Please provide a written response to our comments.
Please be as detailed as necessary in your explanation.  In some
of
our comments, we may ask you to provide us with information so we
may
better understand your disclosure.  After reviewing this
information,
we may raise additional comments.

	Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects.  We welcome
any questions you may have about our comments or any other aspect
of
our review.  Feel free to call us at the telephone numbers listed
at
the end of this letter.

Form 10-KSB for the Fiscal Year Ended December 31, 2004

Consolidated Balance Sheets, page F-3

1. On page 15 you disclose that you anticipate selling both of
your
commercial real estate properties during the first six months of
2005.  Tell us the specific facts and circumstances that have
precluded the accounting described in paragraphs 30 and 42 of SFAS
144, generally requiring classification of long lived assets to be
sold as held for sale, and reporting of the related results of
operations as discontinued operations.

Consolidated Statement of Stockholders` Equity, page F-8

2. We note from disclosure in your Form 10-KSB for the year ended
December 31, 2003 that you effected a four-for-one reverse stock
split during 2003.  Please explain to us how the stock split was
taken into account in determining the appropriate conversion
formula
for holders of the Class C common shares, while retaining the
economic and voting equivalency of the Class A and Class C common
shares.

Note 2 - Acquisition of Food and Culinary Technologies Group Inc.
(FACT), Intellectual Property and Issuance of Class C Common
Stock,
page F-13

3. Please explain to us if the transfer of assets from F.A.C.T.
Group
LLC to FACT was made in contemplation of the acquisition of FACT
by
Capital Reserve Corporation.  Also explain the relationship
between
F.A.C.T. Group LLC and FACT, prior to your acquisition.  Identify
any
common ownership between these two entities, and tell us the cost
basis that F.A.C.T. Group LLC had in the intellectual assets prior
to
the transfer.  Please submit a detailed list of your intellectual
assets, showing the value ascribed to each item, reconciled to the
totals reported in your balance sheet.

4. We note that on February 11, 2004 all of the holders of your
Class
C common stock elected to convert their 2,000,000 Class C shares
into
12,000,000 shares of Class A common stock, after the terms for
conversion were amended to eliminate the condition of achieving
cumulative sales of $56,150,000.  Given the conversion formula, it
appears that control of the enterprise had transferred to the
recipients of the 2,000,000 shares of Class C common stock,
representing 71 percent of your outstanding Class A shares at
December 31, 2004.  Tell us whether you believe this change in
control occurred upon issuing the Class C common shares, on
conversion, or some other point in time.  Describe all changes in
management and board representation, identifying their affiliation
with either Capital Reserve Corp or the FACT related entities,
while
comparing the periods before and after the issuance of the Class C
common shares; and subsequently, on conversion.  Explain why you
opted to eliminate the conversion conditions and identify the
amount
and form of consideration that you received in exchange for this
concession.

5. Concerning your accounting for the settlement agreement reached
in
August 2003, between you and F.A.C.T. Group LLC, tell us where you
recorded the debit to offset the Acquisition Cost Payable recorded
on
the Consolidated Balance Sheet.  Please clarify whether the
minimum
royalty provisions introduced in conjunction with your settlement
effectively removed the conditional element previously attached to
your purchase obligation.  Tell us why you believe the $2 million
component had appropriately been recorded as part of the cost of
your
Intellectual Property prior to this point.

6. Although you disclose that you believe the intangible assets
have
an indefinite useful life, you also explain that once significant
commercial operations commence using the intangible assets, an
estimated useful life will be determined and amortization will
begin.
The guidance in paragraph B59 of SFAS 142 suggests that an
estimate
of an intangible assets useful life should be made, even if the
precise useful life of the intangible asset is not determinable,
and
that the intangible asset would still have to be amortized.

Note 14 - Segment Reporting, page F-22

7. Please note paragraph 25 of SFAS 131 requires that information
related to segments shall be provided for each period in which an
income statement is provided.  Please revise your disclosure to
include segment information for all required periods.

8. The total loss from operations presented in your table does not
equal the loss from operations reported on the Consolidated
Statement
of Operations.  The guidance in paragraph 32(b) of SFAS 131
requires
a reconciliation of these amounts.

Note 16 - Distribution of Capital Canada, page F-23

9. We note that you distributed all of the issued and outstanding
shares of Capital Canada to existing shareholders during the
fiscal
quarter ended December 31, 2004.  However, it appears from
captions
within the Statement of Operations and Statement of Cash Flows
that
you recorded the disposition as of the beginning of the year.  For
example, we note $0 in revenue and expense for petroleum
operations
for the year ended December 31, 2004, and a line item on the
Statement of Cash Flows which states "Adjustment to cash at
beginning
of period from disposition of Capital Canada."  Please explain to
us
how you accounted for the disposition of Capital Canada, including
specific accounting literature relied upon in determining how and
when the disposition should be recorded.

10. You disclose that you recorded an accounts receivable from
Capital Canada of $325,559 net of impairment of $325,000.  Tell us
the period and line item reflecting the impairment charge on the
face
of your financial statements, and explain the reasons you believe
your presentation is appropriate.

Item 8A. Controls and Procedures, page 27

11. You state your evaluation of your disclosure controls and
procedures was completed within 90 days of the filing date of your
annual report.  Your evaluation must be completed as of the end of
the period covered by your annual report to comply with the
requirements of Item 307 of Regulation S-B and SEC Release No. 33-
8238.

12. We note your disclosure "There were no significant changes in
our
internal controls...."  The guidance in Item 308 of Regulation S-B
requires disclosure of any change in internal control over
financial
reporting that has materially affected, or is reasonably likely to
materially affect, the small business issuer`s internal control
over
financial reporting.

Closing Comments

       Please respond to these comments within 10 business days or
tell us when you will provide us with a response.  Please furnish
a
letter that keys your responses to our comments and provides any
requested information.  Detailed letters greatly facilitate our
review.  Please understand that we may have additional comments
after
reviewing your responses to our comments.

	 We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filing to be certain that the
filing includes all information required under the Securities
Exchange Act of 1934 and that they have provided all information
investors require for an informed investment decision.  Since the
company and its management are in possession of all facts relating
to
a company`s disclosure, they are responsible for the accuracy and
adequacy of the disclosures they have made.

	In connection with responding to our comments, please
provide,
in writing, a statement from the company acknowledging that:

* the company is responsible for the adequacy and accuracy of the
disclosure in the filing;

* staff comments or changes to disclosure in response to staff
comments do not foreclose the Commission from taking any action
with
respect to the filing; and

* the company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.

      In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in our review of your filing or in
response to our comments on your filing.

	You may contact Mark A. Wojciechowski at (202) 551-3759 if
you
have questions regarding comments on the financial statements and
related matters.  Please contact me at (202) 551-3686 with any
other
questions.

								Sincerely,

								Karl Hiller
								Branch Chief

??

??

??

??

Ms. Jacqueline Danforth
FACT Corporation
June 24, 2005
Page 1

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-7010

   DIVISION OF
CORPORATION FINANCE
MAIL STOP 7010

</TEXT>
</DOCUMENT>