Err, this is working perfectly from what I can tell.

You can't define VERBOSE like that; VERBOSE is defined in
/etc/default/rcS and must be either the value "no" or different value.

You could argue that you should be able to define VERBOSE in the
environment, but that's a wishlist bug against sysvinit - and unlikely
to be fixed in Ubuntu since we're moving to using Upstart

** Changed in: module-init-tools (Ubuntu)
       Status: Unconfirmed => Rejected

-- 
init script broken
https://launchpad.net/bugs/81350

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