In Ubuntu systems rsyslog handles system logging, redirecting output from several daemons (such as sshd) to their respective logs according to its config.
There are several config files that could affect the usage of the log file. I would start by debugging rsyslog, first checking its config at /etc/rsyslog.d (more likely, 50-default.conf) and looking for a line that should look something like this:
If it's not set up to /var/log/auth.log, then you just found the problem, the output is going somewhere else. If not...
Next, check that rsyslog is actually running with
systemctl status rsyslog, if it's not, it is possible something disabled it or it's not even present as a service, you can re enable (if it's there) the daemon with
systemctl enable rsyslog.
Also, your sshd config could be either disabling logging completely or overwriting rsyslog's configuration, check for
SyslogFacility inside your sshd.conf, which could be redirecting the messages to another rsyslog facility, by default it should be
AUTH (as the line in the first step config). Of course,
LogLevel is also important, but you got it in
VERBOSE, so that shouldn't be the problem.
For debugging sshd, you could try putting it on debug mode with
-d, as stated on man:
Debug mode. The server sends verbose debug output to standard error, and does not put itself in the background. The server also will not fork and will only process one connection. This option is only intended for debugging for the server. Multiple -d options increase the debugging level. Maximum is 3.
Be careful while tweaking sshd if you are on a sshd connection as you could, of course, end up locked off the remote machine.