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To create a Rank go to system admin/User Ranks, then "Add New Rank". Special ranks can be assigned to users irrespective of the number of user posts--to do this click the "Special" checkbox. You can edit an existing rank and make it "special" if you wish
To assign a Rank to a user go to system admin/edit user, and then modify a user. Look for the "rank" dropdown. The special rank you have created will appear in the list.
System admin/preferences/user info settings allows you to increase the max size of avatars, and also allows you to set up custom uploads for users.