Creating user email changes email to entities and fails!


Just tried to create a new user via admin on a test/staging site (im moving to a new server) and for the email address I put

but when I click add, it fails with the message
ERROR: The email address isn’t correct.

and I notice the email address box now says

Any ideas what might be causing this? I have just moved to a cloud server, but it cloned the site directly across without any apparent issues.