Looks like an issue with FUSE. Tried standalone ActiveMQ and JAAS and SimpleAuthentication plugins works fine with the same login.config.
org.apache.activemq.jaas.PropertiesLoginModule in Standalone ActiveMQ is available in the activemq-jaas.jar.
Installed activemq-jaas-188.8.131.52-fuse.jar in FUSE and still same error. Sometimes it seems using the FUSE distribution creates more issues.
Is there any resolution to this issue? I have the same issue with FuseMQEnterprise.