John: In my opinion, that doesn't say much about the aikikai school (if they really laughed at him)...
But, that is the very reason to have paper trails. Not for the "he has paper therefore he is good" but for the "if I train here, I can train there." It does, to some extent, give a 'picture' of a person at a given time (when the paper was awarded).
I know people have complained about this type of thing many times.
The American Jujitsu Association (I know nothing about them personally) has an idea...
Post testing results on-line so that everyone can see who was tested and who tested them.
[See American Jujitsu Association Web-site with testing results
I think each person awarding the belt should also be listed (with the person/board that gave them their belt).
I think this is possible? Is it practicable? Is it a good thing? Is it better than nothing (or whatever we have at present)?