IS Demanded £80m For Journalist's Release

Islamic State (IS) fighters who beheaded American journalist James Foley had demanded £80m ($132.5m) for his release, according to AP news service.

Two anonymous American officials quoted by AP said the ransom demands were sent in emails to Mr Foley's family in Rochester, New Hampshire.

The US - unlike several European countries that have given millions to the terror group to spare their citizens - refused to pay.

A gruesome video was released of the reporter being killed by an IS jihadist in which the group says it is acting in retaliation for US airstrikes in Iraq.

James Foley was kidnapped in Syria two years ago

US Defence Secretary Chuck Hagel told a news conference the strikes have "stalled" the IS advance, but warned it would regroup and stage a new offensive.

He said IS is more than a traditional "terrorist group" and better armed, trained and funded than any recent threat.

"They marry ideology and a sophistication of strategic and tactical military prowess. They are tremendously well funded. This is beyond anything we have seen," he warned.

Mr Foley's killer is believed to be British

Asked why the American military has not launched airstrikes on IS forces in Syria, he said it was "exploring all options".

Earlier, US Attorney General Eric Holder said a criminal investigation has been launched into Mr Foley's murder.

Counter-terrorism police in the UK have already begun efforts to identify the black-clad man beheading the 40-year-old.

Although his face is covered, he speaks with an English, possibly London, accent.

The US has launched 57 airstrikes around Mosul Dam

People previously held hostage by IS have suggested he may be a jihadist known as "John" who was part of a group guarding captives in Syria. 

A former hostage, who was held for a year in the Syrian town of Raqqa, told The Guardian the killer was the ringleader of a trio of UK-born extremists nicknamed "The Beatles" because of their nationality.

The two others were reportedly dubbed Paul and Ringo.

American airstrikes have continued against IS forces in northern Iraq, despite the group threatening to kill a second US captive if attacks go on.

Chuck Hagel warns of the threat posed by IS

US Navy fighters and drones provided air cover to Iraqi and Kurdish forces trying to retake and maintain control of the strategically important Mosul Dam.

The US has carried out 90 airstrikes in Iraq since August 8, with 57 of them in support of Iraqi government forces near the dam.

Meanwhile, Interpol has called for a globally co-ordinated push to stop the tide of international fighters joining IS, also known as Isis.

It did not give any specific recommendations, but said it is particularly concerned that Mr Foley's killer may be British.

Pope Francis has phoned Mr Foley's parents Diane and John

"(This highlights) the need for a multilateral response against the terror threat posed by radicalised transnational fighters travelling to conflict zones in the Middle East," said Interpol Secretary-General Ronald Noble.

More than 1,000 radicals from Europe have joined Islamist militants in Syria and Iraq, and Interpol has long warned of the threat such fighters pose.

European governments fear they could stage attacks when they get home and have introduced new anti-terrorism measures to try to catch them or stop them leaving in the first place.

Pope Francis has phoned Mr Foley's parents Diane and John, according to a Vatican spokesman. He gave no details of the conversation.

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