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I worked hundreds of IM games during my college years and in my experience your choices are to eject the players and/or forfeit the game. At my school a forfeited game caused teams to forfeit sportmanship dollars that they had paid at the start of the season (very effective).
If you don't want to take those actions, let A shoot with B in an illegal spot. If the shot goes in, A gets the point and you go on. If not, it is a violation and A gets to shoot again.
Regardless of all of the above, report the offending players to the League Manager. We used to ban players from all IM activities if they could not learn to play by the rules.
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