Published: Sep 09, 2013 10:23 PM EDT
Updated: Sep 10, 2013 12:16 AM EDT

LEE COUNTY, Fla. -- Since WINK News first broke this story at 4pm, we've uncovered a lot of new details about how the elaborate scheme worked.


WINK News caught up with the suspect earlier Monday night. He's Michael Schnatter, the owner of a door-to-door meat and seafood company in southwest Florida.


Schnatter is out of jail, charged with fraud and embezzlement.     

The undercover operation started thanks to an employee who deputies say saw the bad behavior, and decided to come forward. 


A detailed 20 page report say Michael Schnatter began to realize something was up when he met with the undercover detective.

Exclusive video shows Scnhatter backing out of his garage of his North Fort Myers home just days after his arrest. In the back of his truck was a fridge with the name of the company he owns. 


According to the sheriffs office, an employee with Blue Ribbon Steak and Seafood became a confidential informant and met with a lieutenant in a Rib City parking lot in Cape Coral. 


That meeting launched an undercover operation showing Schnatter and at least one of his employees offering people cash for food cards, but at a fraction of what they were worth.


WINK News has video of Schnatter interviewed in a previous, unrelated story.


The electronic benefits transfer, or EBT cards store money for needy families. And they're paid for by taxpayers. The report shows Schnatter would swipe the customers' cards as a food purchase taking the money from the card. even providing a receipt.


During the course of the undercover investigation, "rouse" EBT cards were provided by the state. A transaction using a rouse EBT card happened here in a 7-Eleven parking lot, and another transaction happened at All Star Lanes in North Fort Myers.


The report also indicates Schnatter said when one woman's card locked up... "she would be able to perform a sexual act for payment."


As to why people were so willing to give up their cards, the sheriff's office says some people would rather have cash to spend on whatever they want, instead of a card, which puts restrictions on what they can buy.


Selling an EBT card breaks a federal law, and you could face fines or an arrest.