A girl of ten was fined £40 by police for writing on an elderly neighbour's wall in crayon.
Shannon Smith, a Girl Guide, was also fingerprinted and threatened with an Asbo.
Her mother Helen, 29, said the girl was terrified by the reaction of police to the small 's' she inscribed while playing with her brother and two others.
Mrs Smith said: "She is scared and upset and frightened by it and has been crying about it in school. I think it has all been blown out of proportion - what's wrong with a telling-off, which is what she had already had from me?"
Another of the children, a ten-year-old boy, also received a £40 fine for criminal damage over the graffiti.
A spokesman for Rossendale Police said the fixed-penalty notices had now been withdrawn, because the children had helped the neighbour involved to paint over the writing.
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