Among other loot, I'm occasionally awarded with Badges. There seems to be many different badges, each corresponding to a particular character class. They all sport the same item description;
Gives the user a higher Rank and changes his or her appearance to a Veteran.
I put Veteran in italics because in the game's item description the word is colored yellow, showing it's of some importance.
What does higher Rank mean? What does Veteran mean? What do these items do? They clearly make my characters appear different, but do they have any other signifigance?