The Islamic State demanded the release of Dr Afia Sidiqqi who has links to al-Qaeda in exchange for James Foley, it has emerged.
Addressed as "a message to the American government and their sheep like citizens", the group claim it offered the United States chances to release Foley though "cash transactions" and the release of Dr Afia Sidiqqi.
Sidiqqi, who was trained as a neuroscientist in the United States, is currently serving an 86-year prison sentence in Texas for attempting to kill US soldiers while she was being questioned on suspicion of planning terrorist attacks against American citizens.
"You were given many chances to negotiate the release of your people via cash transactions as other governments have accepted," the email said.
"We have also offered prisoner exchanges to free the Muslims currently in your detention like our sister Dr Afia Sidiqqi, however you proved very quickly to us that this is NOT what you are interested in."
A British family have told ITV News of their devastation after discovering a close relative is fighting with the Islamic State in Iraq.
A French journalist who was held hostage with James Foley in Syria has told ITV News it was "devastating" to see his murder.