I think this change occurred after the upgrade to the latest VBulletin. It might just need a minor tweak in the VB settings.
Moderators can view but not change that User Title, I'm fairly certain only Administrators can. Previously any user could change it.
Strange thing is as a moderator I can change my own (and it seems others can). So perhaps the issue only effects accounts created on the newer version of VB.
If you really want it changed desperately, I think habs is the only person able to do it.