You'll need to check the scope of your permissions.

If the parent folder access is set to "This folder, subfolders and documents" or "This folder and subfolders" the permissions carry down.

It sounds like you want the top-level permissions to be "this entry only"

Then you can set up granular access to the child folders (i.e., they all see Folder 1, but additional rights are needed to see A, B, etc.)

Typically, I use repository groups to handle this:

For example, I'll create a "base" group that has access to the top (Folder 1) with the This Entry Only scope, then I create groups for each of the subfolders (or groups of subfolders).

From there, you can add the subfolder groups as members of the "base" group meaning the Folder A, Folder B, and Folder C groups would all inherit access to Folder 1.

That way, users only need to be a member of one group to get access to the respective folder since that group would also inherit access to the parent.