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It's a scam in the same way that Colonel Sanders is a fraud (he's not a real colonel.)
More like a fraud like the way the "Name a Star" organizations are.

A Kentucky Colonel is not a military rank, but it is an honorary colonelcy bestowed by the Commonwealth of Kentucky to Sanders in 1935.

To be fair, some also say that someone with a PhD isn't a "real doctor."

More fundamentally, aristocratic titles, are also a scam.