What do you mean? "what can I say to her"
She sees you as her scape goat, I know its all very well she's your childhood friend, but what I haven't seen mentioned throughout this thread is What about your 4 Kids? You have a 3 very young children, you have your hands full.
You need to put your own children first. Its all very well being kind, but now you have find yourself and the centre of their toxic drama and have been pulled right into it.
That child is only 12, what happens when she hits the teenage years, she has a lot of baggage that you're not trained to manage. I know others are coming on here saying its a really nice thing to do, but you are putting your own young family at a huge risk that you are not even aware of yet.
You need to be strong and do the right thing for your kids.
The first thing I would do is completely break complete contact that that "Friend" .
I know this sounds very tough, but a 12 year old doesn't get to decide she's staying in your home. This is only the start of it!
Her mother doesn't want her back, what does that tell you? What happens when she gets confortable in her new environnment and starts kicking off in your home? What does your husband say in all of this.
The longer you keep that child in your home, the harder it will be to remove her, you will never have any peace.