Correctional Services spokesman Manelisi Wolela has denied allegations that student leader Mcebo Dla.
"He is possibly in Cyprus and there are already discussions with the police there," Colonel Eugène Opperman said yesterday.
Opperman could not say whether Smith was being monitored.
"I think that is part of the investigation," he said. "He has been red flagged at airports and with Interpol."
Earlier security specialist Paul O'Sullivan told Talk radio 702 that he had tracked Smith down to his home in Cyprus.
He said Smith was living with his wife and he was in possession of their phone numbers.
Jackson, the owner of the Teazers franchise of strip clubs, was found murdered at a house in Edleen near the OR Tambo International Airport on May 3.
Smith allegedly phoned Gauteng crime intelligence boss Joey Mabasa and confessed to killing Jackson shortly after the murder.
He had been missing ever since.