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Seriously, what "awards" does the school "withheld"? This is not something the sanctioned by any school or school district, more like forced on them. It is their discretion how, when and if to pass that information onto the student.
I was a National Merit Scholar a long time ago and if I recall, I received a letter from the organization directly. They should go back to that.
Edit: I’m talking literally 40 years ago >

I was as well, about 10 years ago. They sent the letter to my school. The only reason I knew anything about it was because another student who had a teacher as a parent. After a while the teacher went to the counselor to ask about results and found out she had the letters, and only then did she hand them out. 
I also got several big scholarships from one of my top 2 universities, but they sent those offers directly to my school instead of me. When I went to pick up my diploma after graduation, she handed me a massive package with all their scholarship offers. She just stuck them in my file and said nothing to me about them. I figured that school hadn't given me any and opted for the other university. She told me she didn't like delivering mail to students all the time so she just held on to them until they came to her office to get them. This was a small school, so it wasn't like that was a time consuming job to begin with, and I didn't even know they had any mail for me to pick up. >

Scholarship are different matters. Most likely, what your conselor didn't give you in time is not "scholarship offer", but "offer to apply for scholarships". But if you applied for those scholarships already and they were real scholarship offers, that lazy counselor might have broke the law by withholding your mail. >

They were real scholarship awards that congratulated me and gave me a deadline to accept. Some were automatically awarded based on merit (I was notified of those when I got my acceptance letter, but they also sent letters to my school) and a few that I applied or interviewed for. I had actually called the financial aid office a couple times to check on the status, and they told me they couldn't release info over the phone and I would receive a letter if I was awarded anything. 
I even called the school after to explain and ask if anything could be done. It was a private university and they told me it was standard to send award letters to the high school as well so they could announce them at graduation or academic banquets. They had an explanation but not a good one for why nothing was mailed to my house as well. They did reoffer certain scholarships, but most were already granted to the next applicant and they understandbly couldn't rescind them. 
It wasn't entirely her fault since the university dropped the ball too, but it was still frustrating. It's no big loss since I was leaning towards the other school anyways and, looking back, I'd make the same choice. >

That's interesting. Then my guess would be that counselor might be intentionally withholding some of the scholarship letters from you.  Could be a number of reasons, jealousy, or some other kid was also applying for the same scholarship etc. 
College application process has become very intense in US. I don't understand that at all. I would think if any school didn't want me for whatever reason, I wouldn't want to be associated with that school at all either. >

Do counselors know the contents of every student letter they receive? My guess is no. Doesn't make it any less shitty... colleges should communicate directly with those they want to contact and schools should deliver items to their students in a timely fashion >

My kids were National Merit Scholarship finalists (not in VA, pre-covid). The first came within a couple of days of missing out on a full ride scholarship (tuition, housing, and meals) because the high school did not notify us. I luckily read something online and contacted the school because it sounded like my kid met the criteria to be a finalist. The school did not apologize or acknowledge how they almost screwed us over. After the first kid, we knew to contact the school early on. Missing out on the scholarships would have significantly changed the lives of everyone in our family (including us parents).
Make sure you keep track, don't expect the school to let you know. >

Better yet, have every single student in the school contact the school office daily to ask if the results have come in and whether that child qualified for anything. For several months around notification time. Until the school establishes a policy of notifying students and have demonstrated they can follow it. >

I guess it wouldn't have to be that drastic. If one person finds out the results are available and lets everyone know, you could just have 3 days of massive numbers of phone calls from every student that took the test. It isn't even that unreasonable, considering the stakes. >

This is just so weird. >

The part that confuses me the most is the Attorney General investigating possible civil rights violations (?) over the whole thing >

What's confusing? These schools withheld awards because they didn't want white and Asian children to receive recognition. That's a clear civil rights violation.