Remember the male friend mentioned earlier? That's the reincarnation of Kanon, and he's the one behind the conspiracy. Someone on the human side had a grudge against Arnos and absolutely refused to believe his words. Kanon desperately tried to vouch for Arnos, but in the end an institution to restart the war after Arnos' reincarnation was created anyway, so Kanon abandoned them. Arnos' situation is because Kanon and the subordinates completely severed his identity as the demon lord's reincarnation, which was meant to avoid making him the target of the war once it restarts. Instead Kanon would take on the role, and then die during the war so that there would be peace. That's what his plan was anyway.
Arnos' "unqualified" brand is pretty obviously meant to mark him as the true reincarnation, and this is accepted as fact by the end of volume 3/start of 4 since the threat of war that Kanon was working against is no longer around.