The pre-Christmas siege of the Lindt chocolate cafe triggered a security lockdown in an area of Australia’s biggest city that houses several government and corporate headquarters, as hundreds of armed police surrounded the site.
The government said there was no clear motivation but the flag appeared to be one commonly used by jihadist groups bearing the shahada, or profession of faith in Islam. It said: “There is no God but Allah; Mohammed is his messenger.”
More than 40 Australian Muslim groups jointly condemned the siege and the use of the flag, which they said had been hijacked by “misguided individuals that represent no-one but themselves”.
“We reject any attempt to take the innocent life of any human being or to instil fear and terror into their hearts,” they said in a statement.
Australia has been on high alert after the government raised concerns that citizens who have fought alongside jihadists in Iraq and Syria could return home radicalised and carry out “lone wolf” attacks.
Prime Minister Tony Abbott convened a national security meeting to deal with the “disturbing” development.
Some six hours into the siege, three men emerged from the popular cafe and ran for their lives, two from the front door and one from an emergency exit. Around an hour later two distraught women also fled. It was not clear if they escaped or were released.
One was barista Elly Chen whose sister Nicole said on Facebook: “Yessss I finally see you. I’m so glad you’re safe!!!!”
Among those left inside was an employee of Indian IT giant Infosys, the company said, as the leaders of India, Britain and Canada tweeted their concern. US President Barack Obama was briefed on the crisis, the White House said.
Negotiators “have had contact and continue to have contact” with the armed man holding the hostages, New South Wales state deputy police commissioner Catherine Burn said. “We do not have information to suggest that anyone is harmed at this stage,” she added.
Channel Seven reporter Chris Reason, whose newsroom is opposite the cafe, tweeted: “From inside Martin Place newsroom, we’ve counted around 15 hostages — not 50 — mix of women, men, young, old – but no children.”
Reason added: “We can see gunman is rotating hostages, forcing them to stand against windows, sometimes 2 hours at a time.”
The hostage-taker, reportedly armed with a shotgun, made a series of demands through Australian media, but they were retracted after police requested they not be made public.
Journalist Chris Kenny, who was in the Lindt cafe just before the siege began, said he understood the automatic glass sliding doors had been disabled.
He added that a woman who tried to get in as he was leaving saw someone with a weapon who told those inside “to put up their hands”.
The scene of the drama, Martin Place, is Sydney’s financial centre and houses several prominent buildings, including the New South Wales parliament, the US consulate, the country’s central bank and the Commonwealth Bank of Australia.
Many shops in the area opted to close early due to the scare, with only a trickle of people walking along usually bustling streets.
At the nearby Sydney Opera House, where police had swept the area earlier Monday, evening performances were cancelled.
“It’s sad to think this is my home and that it could happen anywhere,” said onlooker Rebecca Courtney.
The hostages were taken in the morning, just minutes before police announced a man had been arrested in Sydney on alleged terrorism offences.
They said the 25-year-old was seized as part of “continuing investigations into the planning of a terrorist attack on Australian soil and the facilitation of travel of Australian citizens to Syria to engage in armed combat”.
Police said they did not believe the matters were related.
The government in September raised its terror threat level and police conducted large-scale counter-terror raids across the country. Only two people were charged.
More than 70 Australians are believed to be fighting for Islamic militants in Iraq and Syria. At least 20 have died. (AFP)