If they're smart, the Phantoms will attempt no subterfuge because they will reveal themselves in the process. For example, if player A says "hey everybody, I'm the Paladin" and player B says "no wait, I'm the Paladin", then we've just narrowed the first Phantom down to 2 players. From that point, it's pretty easy for the innocents to figure out which one is the actual Phantom. If the Phantoms remain quiet (as well they should), the innocents now know they can completely trust the Paladin player (which was never the intent).
Since part of the point of Phantom is subterfuge, deception, misdirection, I've added an option called "Paladin Marks" to counter this behavior. A Paladin Mark is a single use "guess" that a Phantom can use to "mark" a player. If the player being marked is indeed a Paladin, they will imediately lose their Paladin bonus (yes Mead, I agree with you, having this kill the Paladin was a bit excesive

As with all the major options we've introduced so far, this one can be turned off if so desired (i.e. if you don't like it, dont use it).
EDIT: Paladin marks are set to none by default.
Changes in v1.8
1: Added Paladin Marking feature
Phantoms can now "mark" a player that they think is a Paladin. If correct, the Paladin will lose their Paladin bonus and all players will be informed that a Paladin has been marked. If incorrect (i.e. the marked player is not a Paladin), then nothing happens. Either way, the mark is spent and cannot be used again.
Paladin Marks are used via a new button on the phantom UI (crosshair icon). The button will be displayed next to the dump mass and dump energy buttons. If the Phantom has no available Paladin Marks, this button will not be visible.
2: Added The following Lobbly Options
Paladin Marks
-Available choices will be None, One per Phantom, Two per Phantom, One per Paladin, One, Two, Three, or Four.
-This option controls how many Paladin marks will be given to each Phantom.
-Paladin Marks are distributed in a round robin fasion between the phantoms.
(In some scenarios, not every Phantom will get a Paladin Mark)
EDIT: Removed file for further testing and modification.