A report in an American newspaper claimed that Allan MacAskill had worked with companies which had been trying to do business in the African country.

But the Justice Secretary said today: “This report is totally and utterly ridiculous.”

His brother is business development director of Aberdeen-based SeaEnergy Renewables which is understood to have no business intgerests in Libya.

The report emerged in the wall Street Journal and is certain to cause further anger in America over the handling of the release of Abdelbaset al-Megrahi.

The paper quotes Allan MacAskill as denying he played a role in bids for Libyan business and that he never discussed the Lockerbie bomber case with his brother.

But Scottish Conservative Leader Annabel Goldie said: “If any part of Mr Salmond’s Government has any connections to Libyan businesses then they need to come clean.

“Already it has emerged that there was double dealing and nudge and wink diplomacy. The Labour UK Government and SNP Scottish Government need to be open and transparent once and for all and stop this constant drip drip of information which only serves to undermine Scotland and the United Kingdom.”

The Wall Street Journal claims Mr MacAskill is business development directorwith SeaEnergy Renewables, a firm that develops offshore wind farms.

He is quoted as saying: “[Kenny MacAskill’s] my brother and he is a minister of the Scottish government, anything to do with Megrahi is nothing to do with me,” Allan MacAskill said on Monday. “We [SeaEnergy] have nothing to do with it.”

A Scottish Government spokesman said: “As the Justice Secretary has made clear, he made his decisions to reject prisoner transfer and grant compassionate release based on due process according to Scots law - having considered the recommendations from the Scottish Prison Service, the prison governor and the parole board, and the medical evidence, all of which supported compassionate release.”

Mr MacAskill`s brother is business development director for SeaEnergy Renewables.

His biography on the company website said: “Allan MacAskill has a track record of technical and commercial innovation in both the oil and gas and renewables industries.

“In the last 10 years he has been involved with a number of mature reservoir redevelopments with proven expertise in project management, field development, reservoir management, production operations and renewable energy.”

The Wall Street Journal said no connection had been revealed between Mr MacAskill and commercial factors that may have led to the release of Megrahi.

Allan MacAskill told the newspaper that neither he nor his firm were in any way connected to the decision.

A spokeswoman for SeaEnergy said Allan MacAskill joined that firm 18 months ago.

He had previously worked for Talisman, where he had been involved in the Beatrice offshore wind project.

“Allan has been exclusively focused on renewable energy since 2005,” she said.

“I can confirm he has never had a conversation with Kenny MacAskill about Al Megrahi.

“He works for an offshore renewables company which is doing well.”