This has not happened to me but I have heard of plenty of longarmers this has happened to. They longarm a quilt and are paid for their services, the owner enters it in the show and are awarded a ribbon for "Best longarm Quilting".
9 times out of 10 the owner of the quilt keeps that ribbon. There have even been a few cases I have heard where the longarmer isn't even credited as having quilted the quilt. It happens. Some shows (like MQX) will give two ribbons. One for the piecer and one for the quilter.
As for the OP question, I am of the opinion the ribbon should go to the maker of the quilt, especially if they were the ones who entered it (even though they already gifted the quilt to another).
If I make a quilt I plan on gifting and showing, I will show the quilt before gifting it.