For a few years, I worked a non-emergency medical transportation job in Detroit. I've driven down probably every street in the entire city, and it was common to pass by party stores that would openly advertise "We buy EBT benefits" on a huge sign out front.
Michigan's EBT (called the Bridge Card) allows some cash to be withdrawn, but the rest has to be spent directly on food. Party store owners would debit the food stamp portion, and give the "customer" 50% in cash.