Correctional Services spokesman Manelisi Wolela has denied allegations that student leader Mcebo Dla.
This happened despite the fact that the immigrant is a naturalised South African.
Salman Hamid had initially paid R500 into the bank account of the department's acting regional manager in Polokwane.
The official claimed Hamid was not in possession of legal documents to be in the country.
Hamid is married to a South African woman and is in possession of legal documents.
The Home Affairs employee allegedly demanded R10,000 before Hamid could secure his safety.
After failing to raise the money, he allegedly ordered that Hamid to be deported.
But Hamid took the matter up with his lawyers and they successfully interdicted the department against his deportation.
Sowetan is in possession of a copy of a slip showing a deposit into the official's bank account.
Speaking from the camp yesterday, Hamid recounted how he had suffered.
"The man has been abusive towards me. Each time he wanted money, he expected me to fork it out without any excuses," Hamid said.
He claimed that he had given money to the official in the past "out of brotherhood".
"I was surprised when he kept on demanding more money."
Hamid said at times the official would tell him that his spaza shop was running out of stock and wanted money for the goods.
The official could not be reached for comment yesterday.
Department spokesperson Conny Moitse said: "We will act against any official found to have engaged in any corrupt activity. We are investigating the matter."