I know exactly what you mean and even who you are talking about. I have had the same things happen with just the team you are talking about.
I register my teams AAU and YBOA each year. This way everyone knows my teams play their legal grade and age. I keep birth certificates and proof of grades with me at all tournaments. I have come to learn that most team(NOT ALL) that does not play sactioned tournaments like AAU and YBOA, are carrying over aged and higher grade kids on their teams. The bad part is that the over age kid isn't getting any better. The good part is.............well is there a good part? Yea, the younger kids and the coach of that team get to say they won.
Who does it help in the end? Only the other teams, cause while their playing in their legal age group, they have to play older kids. They have to play harder and smarter to win. Which means they're learning.