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• Identities of slain hostages revealed
• Sydney siege: How the events unfolded
The Prime Minister said the national security committee of Cabinet was seeking answers to questions on the minds of all Australians, as the tragedy echoed around the world.
"How can someone who has had such a long and chequered history not be on the appropriate watch lists and how can someone like that be entirely at large in the community?" Abbott told reporters in Sydney.
"These are questions that we need to look at carefully and calmly and methodically, to learn the right lessons, and to act upon them."
An armed tactical response police officer grabs a hostage as she runs to flee from the cafe . Photo / AP
Abbott said agencies and the Government had been responding effectively since terrorists began threatening acts of random violence against Australians.
But had the "sick and disturbed" individual behind the siege been on a watchlist it was still possible the incident could have occurred. "The level of control that would be necessary to prevent people from going about their daily life, would be very, very high indeed."
Liberal MP Alex Hawke wrote on Twitter: "We must also ask our judicial system why a known criminal who hated our country was not in prison."
Read more:
• Profile of the man behind the siege
Former FBI counter-terrorism analyst Matthew Levitt said it appeared to be more a case of "lone offender violence" than an act of terrorism. Despite Monis being known to authorities it would not have been possible to keep tabs on him.
"Outside of the movies, in the real world no law enforcement agency, not locals, not AFP, not FBI, has the resources to track everybody who's of any interest whatsoever 24/7."
ASIO and federal police officials will appear at a parliamentary inquiry in Canberra today to discuss the third tranche of anti-terrorism laws, dealing with mandatory data retention. It is understood members are keen to broaden its scope to find out if Monis was the subject of surveillance, phone-tapping or metadata checks before he took his action.
Haron Monis was well known to police. Photo / AAP
A hostage runs to armed tactical response police officers for safety. Photo / AP
The committee chairman, Liberal MP Dan Tehan, said the incident reinforced the need for extra resources and powers for intelligence and police agencies.
'Hate sheikh' was no stranger to the courts
Man Haron Monis had planned to send offensive letters to hundreds of British families who had lost sons and daughters in the war in Afghanistan.
The 50-year-old claimed to have written to former British Prime Minister Gordon Brown in 2009 saying he wanted to send "237 baskets of flowers with 237 condolence letters" to the families of the dead.
But Monis was prevented from carrying out his plan by a court in Sydney which charged him with sending "grossly offensive" letters to bereaved Australian families in which he described dead soldiers as the sons of pigs who were no better than Adolf Hitler.
Watch: Sydney gunman had 'infatuation with extremism'
Last year, he failed to overturn a court order preventing him from contacting the families of military personnel in Australia or abroad.
Monis, known in Australia as the "hate sheikh", singled out the author Salman Rushdie and the newspaper columnist Melanie Phillips for criticism in his rambling blog posts, in which he also condemned "Zionists and Zio-Nazis".
Although Monis, an Iranian who was granted political asylum in Australia in 1996, had railed against the war in Afghanistan, investigators will now try to decide whether he was motivated by Islamist extremism or a grudge against the Australian Government. During the cafe siege, he is said to have demanded a flag of Isis (Islamic State).
On Sunday, he posted a picture of dead children on his website with the message: "Islam is the religion of peace, that's why Muslims fight against the oppression and terrorism of USA and its allies including UK and Australia.
An injured hostage is carried to an ambulance. Photo / AP
An injured hostage is taken to a waiting ambulance. Photo / AP
A blood soaked stretcher is wheeled to an ambulance early this morning. Photo / AP
"If we stay silent towards the criminals we cannot have a peaceful society. The more you fight with crime, the more peaceful you are. Islam wants peace on the Earth, that's why Muslims want to stop terrorism of America and its allies."
However, Monis had also become bitter and seemingly paranoid over a series of convictions and pending trials, including an allegation that he was involved in the murder of his former wife.
Monis, who was born Manteghi Bourjerdi, changed his name after he sought asylum in Australia and began describing himself as "Sheikh Haron Monis" after becoming a self-appointed cleric.
Hostages run towards armed tactical responce police as they run to freedom from the cafe. Photo / AP
In August 2013, he was sentenced to 300 hours of community service, but refused to accept the court's verdict. Despite pleading guilty to all 12 charges against him, he appealed, claiming his trial was "politically motivated" and that his children were taken away from him.
Also in November 2013, Monis and his girlfriend, Amirah Droudis, 34, were charged over the murder of his former wife, Noleen Hayson Pal, 30, who was stabbed and set alight in a Sydney apartment block. Droudis was charged with murder and Monis with being an accessory. He claimed he was being framed by the Iranian secret police and the Australian security service, Asio.
Prosecutors said he constructed an elaborate alibi. Monis was involved in a custody battle with his former wife at the time of the murder.
Watch:
the hostages' video here
A magistrate described the evidence as "weak" and made the fateful decision to allow Monis bail. In April, he was charged with sexually assaulting a woman in Sydney in 2002, when he was working as a "spiritual healer" and self-professed expert in astrology, numerology and black magic.
Publicity over the arrest led to other alleged victims coming forward and he was charged with 40 more offences in October. He was still given bail and was due in court in February.
Monis claimed not to be a member of any organisation or party and, despite his strong views on the Afghan war, there has been no suggestion that he was actively linked to any Islamist terrorist groups.
- Jonathan Pearlman and Gordon Rayner - Telegraph Group Ltd