UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                  FORM 10-KSB/A
                                (AMENDMENT NO. 1)

                    ANNUAL REPORT UNDER SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                     For the fiscal year ended May 31, 2007


                          JACOBS FINANCIAL GROUP, INC.
                          ----------------------------
             (Exact name of registrant as specified in its charter)

<TABLE>
<CAPTION>
<S>                                      <C>                                   <C>
======================================== ===================================== =====================================
               DELAWARE                                0-21210                              84-0922335
               --------                                -------                              ----------
---------------------------------------- ------------------------------------- -------------------------------------
    (State or other jurisdiction of            (Commission File Number)         (IRS Employer Identification No.)
            incorporation)
======================================== ===================================== =====================================
</TABLE>


               300 SUMMERS STREET, SUITE 970, CHARLESTON WV 25301
                   -----------------------------------------
              (Address of principal executive offices) (Zip Code)


       Registrant's telephone number, including area code: (304) 343-8171
                                                           --------------


         Securities registered under Section 12 (b) of the Exchange Act:

                                      NONE

         Securities registered under Section 12 (g) of the Exchange Act:

                          COMMON STOCK $.0001 PAR VALUE


Check  whether  the issuer  (1) has filed all  reports  required  to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the proceeding
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
                                                                ---       ---

                                       1
<PAGE>

Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure  will be contained,  to
the best of the  registrant's  knowledge,  in  definitive  proxy or  information
statements  incorporated  by  reference  in Part III of this Form  10-KSB or any
amendment to this Form 10-KSB. [x]

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

State the issuer's revenues for the most recent fiscal year.  $823,339

State the aggregate market value of the voting and non-voting common equity held
by non-affiliates  computed by reference to the price at which the common equity
was sold,  or the average bid and asked  price of such  common  equity,  as of a
specified  date within the past 60 days. As of last trade on September 10, 2007:
$1,571,228 (157,122,836 shares at $.01 / share)

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: 157,122,836 shares of common stock as
of September 10, 2007.







                               TABLE OF CONTENTS

                                    PART III
                                                                            Page

Item 10.        Executive Compensation.......................................4

Item 11.        Security Ownership of Certain Beneficial
                Owners and Management........................................6



Signatures

Exhibit 31.1 Section 302 Certification of CEO

Exhibit 31.2 Section 302 Certification of CFO


                                       2
<PAGE>


                                EXPLANATORY NOTE

Jacobs  Financial  Group,  Inc.  ("JFG",  "we" or the  "Company") is filing this
Amendment No. 1, or the Amended Report,  to our Annual Report on Form 10-KSB for
the fiscal  year  ended May 31,  2007 filed  with the  Securities  and  Exchange
Commission,  or the SEC, on September 13, 2007, or the Original Report, in order
to add certain information required by the following items of Form 10-KSB:

         Item 10.       Executive Compensation
         Item 11.       Security Ownership of Certain Beneficial
                        Owners and Management

We hereby amend Items 10 and 11 of Part III of our  Original  Report by deleting
the text of such Items 10 and 11 in their  entirety  and  replacing  it with the
information  provided  below under the respective  headings.  The Amended Report
does not  affect any other  items in our  Original  Report.  As a result of this
amendment,   we  are  also  filing  as  exhibits  to  this  Amended  Report  the
certifications  pursuant to Rule 13a-14(d) and Rule 13a-14(b)  promulgated under
the Securities Exchange Act of 1934, as amended.

Except as  otherwise  expressly  stated for the items  amended  in this  Amended
Report,  this Amended  Report  continues to speak as of the date of the Original
Report and we have not updated the disclosure contained herein to reflect events
that have occurred since the filing of the Original  Report.  Accordingly,  this
Amended  Report should be read in conjunction  with our Original  Report and our
other filings made with the SEC subsequent to the filing of the Original Report.














                                       3
<PAGE>



Item 10. EXECUTIVE COMPENSATION

The following table sets forth the  compensation  paid by the Company during the
fiscal year ended May 31, 2007 to the  Principal  Executive  Officer and the two
most highly compensated  executive officers of the Company (the "Named Executive
Officers").
<TABLE>
<CAPTION>
-------------- ------ ----------- ------- --------- ----------- -------------- -----------
  NAMES AND    YEAR     SALARY    BONUS    STOCK      OPTION         ALL         TOTAL
                         ($)       ($)     AWARDS     AWARDS        OTHER         ($)
  PRINCIPAL                                 ($)      ($) (1)    COMPENSATION
  POSITION                                                         ($) (2)
-------------- ------ ----------- ------- --------- ----------- -------------- -----------
<S>            <C>     <C>         <C>      <C>     <C>          <C>           <C>
John M.        2007    $150,000     -        -       $109,191     $ 16,647      $275,838
Jacobs, CEO
-------------- ------ ----------- ------- --------- ----------- -------------- -----------
Robert J.      2007    $ 75,000     -        -       $ 34,849         -         $109,849
Kenney, VP
(3)
-------------- ------ ----------- ------- --------- ----------- -------------- -----------
Robert L.      2007    $ 90,000     -        -       $ 19,800         -         $109,800
Neal, CFO (3)
-------------- ------ ----------- ------- --------- ----------- -------------- -----------
</TABLE>

(1)  On May 25,  2006,  the  compensation  committee  of the board of  directors
     awarded  12,500,000,  5,000,000 and 2,000,000 of incentive stock options to
     acquire  common shares at an exercise price of seven cents ($.07) per share
     to Mr.  Jacobs,  Mr. Kenney and Mr. Neal,  respectively,  which vest as set
     forth in the table below. The term of the options is five years and expires
     in May 2011.

--------------------- ----------------------------------------------------------
     VESTING DATE                     INCENTIVE STOCK OPTION AWARDS
--------------------- ----------------------------------------------------------
                      JOHN M. JACOBS       ROBERT J. KENNEY       ROBERT L. NEAL
                      --------------       ----------------       --------------
--------------------- -------------------- ---------------------- --------------
May 25, 2006               2,500,000             2,000,000                -
--------------------- -------------------- ---------------------- --------------
January 1, 2007            2,500,000
--------------------- -------------------- ---------------------- --------------
May 25, 2007                                     1,000,000             500,000
--------------------- -------------------- ---------------------- --------------
January 1, 2008            2,500,000
--------------------- -------------------- ---------------------- --------------
May 25, 2008                                     1,000,000             500,000
--------------------- -------------------- ---------------------- --------------
January 1, 2009            2,500,000
--------------------- -------------------- ---------------------- --------------
May 25, 2009                                     1,000,000             500,000
--------------------- -------------------- ---------------------- --------------
January 1, 2010            2,500,000
--------------------- -------------------- ---------------------- --------------
May 25, 2010                                                           500,000
--------------------- -------------------- ---------------------- --------------

The amounts  shown in this column  represent the dollar  amount  recognized  for
financial  reporting purposes during the fiscal year for the fair value of stock
options received by the named individuals,  excluding the effects of forfeitures
relating to service-based  vesting  conditions.  The assumptions used to compute
the fair value are disclosed in "Note L, Stock-Based  Compensation",  a footnote
to our audited  financial  statements for the two-year period ended May 31, 2007
included in the Annual Report on Form 10-KSB filed on September 13, 2007.

                                       4
<PAGE>

(2)  Other  compensation  includes  insurance premiums paid by the Registrant on
     behalf of the named  executive  officer under a verbal  agreement  with the
     Executive Officer.

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END

The following table sets forth for each of our Named Executive  Officers certain
information regarding unexercised options and stock awards as of May 31, 2007.


----------- --------------------------------------------------------------
                                  OPTION AWARDS
----------- --------------------------------------------------------------
----------- ------------ --------------- ------------ --------- ----------
   NAME      NUMBER OF     NUMBER OF       EQUITY     OPTION    OPTION
            SECURITIES     SECURITIES     INCENTIVE   EXERCISE  EXPIRATION
            UNDERLYING     UNDERLYING       PLAN      PRICE       DATE
            UNEXERCISED   UNEXERCISED      AWARDS;      ($)
              OPTIONS     OPTIONS (#)     NUMBER OF
                (#)      UNEXERCISABLE   SECURITIES
            EXERCISABLE       (1)        UNDERLYING
                                         UNEXERCISED
                                         UNEARNED
                                         OPTIONS (#)
----------- ------------ --------------- ------------ --------- ----------
----------- ------------ --------------- ------------ --------- ----------
John M.      5,000,000     7,500,000          -         $.07    05/25/2011
Jacobs, CEO
----------- ------------ --------------- ------------ --------- ----------
Robert J.    3,000,000     2,000,000          -         $.07    05/25/2011
Kenney, VP
----------- ------------ --------------- ------------ --------- ----------
Robert L.     500,000      1,500,000          -         $.07    05/25/2011
Neal, CFO
----------- ------------ --------------- ------------ --------- ----------

(1)  Non-vested  options of Mr. Jacobs will vest evenly on January 1, 2008, 2009
     and 2010,  respectively.  Non-vested options of Mr. Kenney will vest evenly
     on May 25, 2008 and 2009 respectively. Non-vested options for Mr. Neal will
     vest evenly on May 25, 2008, 2009 and 2010 respectively.

DIRECTOR COMPENSATION

The following  table sets forth  compensation  received by our directors for the
fiscal year ended May 31, 2007.


                -------------- --------------- -------
                    NAME        FEES EARNED    TOTAL
                                 OR PAID IN     ($)
                                CASH ($) (1)
                -------------- --------------- -------
                -------------- --------------- -------
                Frederick E.        $750        $750
                  Ferguson
                -------------- --------------- -------
                -------------- --------------- -------
                  C. David          $750        $750
                  Thomas
                -------------- --------------- -------

(1)      Non-employee  board  members  of JFG's  wholly-owned  subsidiary  First
         Surety Corporation, which include JFG board members, are compensated at
         the rate of $150 per meeting.


                                       5
<PAGE>


Item 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following  table sets forth the beneficial  ownership of common stock of the
Company as of  September  5, 2007 by (i) each person known by the Company to own
more than 5% of the Company's  common stock,  (ii) each of the directors,  (iii)
the Named Executive  Officers and (iv) all directors and executive officers as a
group.  Unless  otherwise  noted,  such persons have sole voting and  investment
power with respect to such shares.
<TABLE>
<CAPTION>

TITLE OF          NAME AND ADDRESS OF               AMOUNT AND NATURE OF
  CLASS           BENEFICIAL OWNERSHIP              BENEFICIAL OWNERSHIP (1)  PERCENT OF CLASS (2)
 ------           --------------------              ------------------------  --------------------
<S>               <C>                                    <C>                        <C>
                  John M. Jacobs
                  300 Summers Street, Suite 970
Common            Charleston, WV  25351                   24,595,627 (3)             15.11%

                  Charles L. Stout
                  Route 1, Box 41J
Common            Bridgeport, WV  26330                   13,175,000  (4)            8.39%

                  Fay S. Alexander
                  6318 Timarron Cove Lane
Common            Burke, VA  22015-4073                   13,256,041  (5)            8.32%

                  William D. Jones
                  513 Georgia Avenue
Common            Chattanooga, TN  37403                  10,752,694  (6)            6.77%

                  Sue C. Hunt
                  1508 Viewmont Drive
Common            Charleston, WV  25302                    8,611,588  (7)            5.43%

                  DIRECTORS
                  ---------

                  Frederick E. Ferguson
                  Rt. 3, Box 408
Common            Fayetteville, WV 25840                   1,600,000  (8)            1.01%

                  C. David Thomas
                  P.O. Box 5157
Common            Charleston, WV 25361                       992,295                   *



                                       6
<PAGE>



                  EXECUTIVE OFFICERS
                  ------------------

                  Robert J. Kenney
                  809 Sherwood Road
Common            Charleston, WV  25314                    3,920,000  (9)            2.45%

                  Robert L. Neal
                  101 Sunset Drive
Common            Charleston, WV 25301                       500,000 (10)              *


*  Represents  beneficial  ownership  of less than one percent of the  Company's
common stock.

         ALL EXECUTIVE OFFICERS
         AND DIRECTORS AS A GROUP (5 PERSONS)             31,607,922                18.93%
</TABLE>

(1)  Beneficial  ownership is  determined  in  accordance  with the rules of the
     Securities  Exchange Commission and generally includes voting or investment
     power with respect to securities.  Shares of common stock issuable upon the
     exercise of options or  warrants  currently  exercisable  within 60 days of
     September  5, 2007 are deemed  outstanding  for  computing  the  percentage
     ownership of the person holding such options or warrants but are not deemed
     outstanding for computing the percentage ownership of any other person.

(2)  Based on  157,122,836  shares of common stock issued and  outstanding as of
     September 5, 2007.

(3)  Includes  12,233,044  shares of common stock held in the name of FS Limited
     Partnership  ("FSLP") of which Mr. Jacobs is the sole general partner.  Mr.
     Jacobs  has the power to vote and to direct  the voting of and the power to
     dispose  and direct the  disposition  of the shares  beneficially  owned by
     FSLP. Includes 6,695,916 shares held in joint tenancy with spouse, Kathleen
     M. Jacobs.  Includes  5,000,000 in vested options to purchase Company stock
     exercisable  within 60 days of  September  5, 2007.  Includes  the right to
     convert Series B Preferred Stock holdings to 666,667 shares of common stock
     exercisable  within 60 days of September 5, 2007. John M. Jacobs is the CEO
     and also a member of the board of directors for the Registrant.

(4)  Includes  25,000  shares  of  common  stock  held in the  name  of  Applied
     Mechanics  Corporation  of  which  Charles  L.  Stout  is  President  and a
     director,  12,150,000 shares held in joint tenancy with spouse,  Marilyn J.
     Stout, and 1,000,000 shares  beneficially owned by members of the immediate
     family.

(5)  Includes  9,900,000  shares of common  stock  held in the name of  Graphite
     Investment,  LLC  ("Graphite")  and  1,000,000  shares  held in the name of
     Southall Management  Corporation  ("Southall") of which Fay S. Alexander is
     President (both entities). Includes the right to convert Series B Preferred
     Stock holdings of Graphite and Southall to 2,141,341 shares of common stock
     exercisable  within 60 days of September 5, 2007.  Includes  214,700 shares
     held in joint tenancy with spouse, Dan C. Alexander.

                                       7
<PAGE>

(6)  Includes  9,060,000  shares  of common  stock  held in joint  tenancy  with
     spouse,  Cynthia B. Jones. Includes the right to convert Series B Preferred
     Stock  holdings to 282,116 shares of common stock (182,116 in joint tenancy
     with spouse)  exercisable within 60 days of September 5, 2007. Includes the
     right to  purchase  1,410,578  shares of  common  stock  (910,578  in joint
     tenancy with spouse)  pursuant to issued and outstanding  stock warrants at
     an exercise  price of  one-tenth of one cent per share  ("stock  warrants")
     exercisable within 60 days of September 5, 2007.

(7)  Includes 1,209,515 shares of common stock held in the Individual Retirement
     Account ("IRA") of spouse,  Douglas E. Hunt.  Includes the right to convert
     Series B Preferred Stock holdings to 200,000 shares of common stock and the
     right to purchase  1,000,000  shares of common stock pursuant to issued and
     outstanding stock warrants  exercisable within 60 days of September 5, 2007
     and held in the IRA of  Douglas  E.  Hunt.  Includes  the right to  convert
     Series B Preferred  Stock holdings to 33,679 shares of common stock and the
     right to purchase  168,395  shares of common  stock  pursuant to issued and
     outstanding stock warrants  exercisable within 60 days of September 5, 2007
     and held jointly with spouse.

(8)  Includes  750,000 shares of common stock held in joint tenancy with spouse,
     Sandra B. Ferguson.  Includes  130,000 shares held in the name of The Party
     Store,  Inc.  ("Party  Store") of which Fred E. Ferguson is President and a
     director.  Includes the right to convert Series B Preferred  Stock holdings
     held in the name Party Store to 120,000 shares of common stock  exercisable
     within 60 days of September 5, 2007. Includes the right to purchase 600,000
     shares of common stock  pursuant to issued and  outstanding  stock warrants
     held in the name of Party Store at an exercise  price of  one-tenth  of one
     cent per share exercisable within 60 days of September 5, 2007.

(9)  Includes  75,000  shares of common stock held in joint tenancy with spouse,
     Lee Anne  Kenney.  Includes  335,000  shares  of common  stock  held in the
     Individual  Retirement  Account  ("IRA")  of,  Robert J.  Kenney.  Includes
     510,000  shares of common stock held in the Individual  Retirement  Account
     ("IRA") of spouse, Lee Anne Kenney. Includes 3,000,000 in vested options to
     purchase Company stock exercisable within 60 days of September 5, 2007.

(10) Includes  500,000 in vested options to purchase  Company stock  exercisable
     within 60 days of September 5, 2007.

There are no outstanding  arrangements that may result in a change in control of
the Company.


                                       8
<PAGE>

SIGNATURES

In accordance  with Section 13 or 15(d) of the Exchange Act, the Company  caused
this  report to be  signed on its  behalf  by the  undersigned,  thereunto  duly
authorized.


                                     Jacobs Financial Group, Inc.

Dated:   September 27, 2007          By:      /s/ John M. Jacobs
                                               ------------------
                                               John M. Jacobs
                                               President and CEO
                                               Director

In  accordance  with the Exchange  Act, this report has been signed below by the
following  persons on behalf of the  Company  and in the  capacities  and on the
dates indicated.

Dated:   September 27, 2007          By:      /s/ John M. Jacobs
                                              ------------------
                                              John M. Jacobs
                                              President and CEO
                                              Director


Dated:   September 27, 2007          By:      /s/ Robert L Neal
                                              -----------------
                                              Robert L. Neal
                                              Chief Financial Officer


Dated:   September 27, 2007          By:      /s/ Frederick E. Ferguson
                                              -------------------------
                                              Frederick E. Ferguson
                                              Director


Dated:   September 27, 2007          By:      /s/ C. David Thomas
                                              -------------------
                                              C. David Thomas
                                              Director





                                        9