This turned out to be a permissions issue, where my jenkins user on the Ubuntu VM did not have access to audio, after an upgrade of Ubuntu.
The following set of commands (And possibly some other ones to reset the pulseaudio driver) fixed it, and Fmod no longer errors on initialization when refreshing banks.
the first line adds the user jenkins to the group audio
the other commands just reset the core audio stuff of a ubuntu install.
sudo usermod -a -G audio jenkins
sudo apt-get remove --purge alsa-base
sudo apt-get remove --purge pulseaudio
sudo apt-get install alsa-base
sudo apt-get install pulseaudio
sudo alsa force-reload
sudo reboot