On second thoughts I don't think this is a bug. For ranks that have a tag, the tag is added to the beginning of user names. In order to prevent members registering and trying to be a fake member, they aren't allowed to add any of those rank tags to the beginning of their names.
This is why you see this error message. If they want to use that tag, then they should ask an admin to change their rank to one that does have that tag.
Please post again if this clears up any confusion.