the board doesn't use html, it uses it's own language.
you have to first save your picture and place it somewhere on the internet like flickr or photobucket, then get the direct link to that. (right click, view image) so that you have a long address that ends with .jpg or .png.
Then place it inbetween tags, the latter having a / to end it.
I added an image of how it should look. It's just like adding pictures to a comment really.
The original picture was a .png file which has transparencies, by saving it as a .jpg you lose those and it looks funny when used in a signature. I'm not sure if the board stores those, but if I made one I can repost it or make you a new one, if you're interested in that.