I played around with a mat for a card I made for the IC48 (see the challenge forum) - after I finished, I decided I could tidy it up a bit and it could look like rick rack (spelling?).
For this one, I glued narrow strips of various colors of cs behind the sentiment, which I had previously trimmed with scissors that make a scalloped edge - at this point, a punch would probably work, too. After gluing the strips, I cut a second edge with the same scallops. Solid should work also. Voila - faux rick rack.
There are most likely others who have done this - I just have not seen any.
Here is my example:
Gallery at Splitcoaststampers