Floyd Shivambu, the founding deputy president of the EFF, has become the most senior EFF politician to be linked to the VBS Bank looting scandal.
Shivambu is claimed to have pocketed over R180,000 from the looting of the VBS bank and failed to disclose to Parliament a series of three payments.
As a Member of Parliament, Shivambu was expected to declare these amounts -- R100,000 (18 August 2017) R30,000 (24 August 2017) and R50,000 (26 August 2017).
VBS Mutual Bank was declared bankrupt and placed under administration in 2018 resulting in over 30,000 investors including pensioners losing over R2 billion.
In 2018 a report by the SA Reserve Bank found that R1.89 billion was transferred from the VBS Bank to 50 people with R16.1 million going to Floyd Shivambu's brother Brian Shivambu.
Parliament plans to sanction Shivambu MP by docking nine days from his MP salary.
Opposition parties have called for Shivambu to "pay back the money".
On Monday night, the EFF launched an extensive strategy to manage the public relations impact on the party and its leadership.
The party said the payments to Shivambu were simple loans between Shivambu and a private company Sgameka (Pty) Ltd and not directly from the VBS Mutual Bank.
"It is an incorrect conclusion of the Committee that the loan amount from Sgameka [Pty] was a donation although Sgameka [Pty] presented an affidavit that the amount is a loan which had nothing to do with VBS," the party wrote.
Shivambu claimed he would challenge the report in court adding that the joint committee investigating the matter went beyond the scope of its work.
"The conclusion that the deputy president received a donation that was not declared is utterly false and not a reflection of reality," the EFF added.
"The deputy president will take Parliament to Court to overturn the Joint Committee's irrational and opportunistic conclusion and sanction."
The parliamentary report also comes amid reports that a faction within the EFF was campaigning for Shivambu to replace Julius Malema as president.
