Australia Foils 'Imminent' Terror Attack

Australia has thwarted an "imminent" terror attack, arresting two men and seizing an Islamic State flag, a machete and a video detailing the alleged plot during a raid in Sydney, police said Wednesday.

New South Wales Deputy Police Commissioner Catherine Burn said the planned attack was "consistent with the messaging coming out of IS", while New South Wales state Premier Mike Baird described it as "beyond disturbing". 

Asked whether it involved a beheading, Burn said police were as yet unsure, but that it had been due to happen Tuesday in Sydney, and would likely have involved a knife. 

The men, Omar Al-Kutobi, 24, and Mohammad Kiad, 25, were arrested in a raid on a property in Sydney's western suburbs by the Joint Counter Terrorism Taskforce on Tuesday after a tip-off, and charged with making preparations for a terrorist act.

They were refused bail on Wednesday, with the case adjourned until Thursday due to security issues. 

"A number of items were located including a machete, a hunting knife, a home-made flag representing the proscribed terrorist organisation IS, and also a video which depicted a man talking about carrying out an attack," Burn said. 

"We will allege that both of these men were preparing to do this act yesterday. We built up information, we received further information which indicated an attack was imminent. And we acted."

Prime Minister Tony Abbott said that "regrettably there are people out there, some living in our midsts, who would do us harm".

But the government was "maintaining a ceaseless vigilance against" such people, he said.

Baird said a potentially "catastrophic" incident had been avoided.

"It was beyond disturbing, what was planned," he told reporters. "Certainly, something catastrophic was avoided yesterday and for that we should be very thankful."

Australia in September raised its terror threat level and carried out extensive raids in Sydney and Brisbane to disrupt an alleged plot by IS supporters to abduct and randomly behead a member of the public.

- Radicalised Australians - 

The Islamic State group is a brutal jihadist organisation that has captured swathes of territory across Iraq and Syria and sucked in increasing numbers of radicalized Australians to its cause.

In December, Sydney was rocked by a siege at a cafe by Iranian-born Man Haron Monis, a self-styled cleric with a history of extremist views.

He took 17 people hostage for some 16 hours, with the stand-off only ending after Monis shot dead cafe manager Tori Johnson, prompting police to storm the building and kill him. Another hostage died in the crossfire.

Abbott on Monday reiterated that the incident was inspired by the Islamic State "death cult".

Burn said the men arrested Tuesday were not previously on authorities' radar and she did not know the exact nature of their alleged target, nor whether it was the police, military or the general public.

But one of those arrested featured in the video seized.

"We can't go into the details of what was actually said in that message," she said. "However, the intent is clear and the intent is what I have told you today."

Islamic State, infamous for beheading and stoning to death its victims, routinely use videos uploaded onto social media for propaganda purposes.

It is increasingly luring jihadists from foreign countries, with more than 90 Australians now believed to be fighting in the Middle East.

Many others are being radicalized at home, with Australia late last year passing a law criminalizing travel to terror hotspots. 

"The concerning thing about this clearly is that this represents the nature of the environment that we currently face," said Burn. 

"This is indicative of the threat that we now have to live with and which we are now having to deal with."