Australia counter-terror police kill man after two officers stabbed

By Lincoln Feast SYDNEY (Reuters) - Australian police said they shot dead a man after he stabbed two counter-terrorism officers, just days after sweeping raids involving hundreds of police thwarted what they said was an imminent plot to behead a member of the public. Australia, a staunch ally of the United States and its escalating action against the Islamic State in Syria and Iraq, is on high alert for attacks by home-grown militants returning from fighting in the Middle East. The 18-year-old man was asked to attend a police station in the southern state of Victoria because his behaviour was "causing concern," according to Luke Cornelius, the Assistant Commissioner of Victoria Police. "It's believed that an altercation has occurred in the vicinity of the police station involving the two police officers and that male person, and in the course of that altercation, the male person has produced an edged weapon," Cornelius said in a press conference late on Tuesday. "It's absolutely clear to us our members had no choice but to act in the way that they did." Police said the man had been displaying a flag linked to the militant group the Islamic State while local media reported he had been shouting insults about Prime Minister Tony Abbott and the government before he was shot and died. "I can advise that the person in question was a known terror suspect who was a person of interest to law enforcement and intelligence agencies," Justice Minister Michael Keenan told reporters on Wednesday. The two officers were taken to hospital with one suffering serious stab wounds, police said. Both were in a stable condition on Wednesday. Earlier this week, Abbott warned Australians the balance between freedom and security "may have to shift", as he outlined broad new powers expected to be introduced to parliament on Wednesday. Australia is concerned over the number of its citizens believed to be fighting overseas with militant groups, including a suicide bomber who killed three people in Baghdad in July and two men shown in images on social media holding the severed heads of Syrian soldiers. Abbott has said that at least 100 Australians are in the Middle East either fighting with or supporting Islamic State or other militant groups, a number that he said has increased in recent months. At least 20 are believed by authorities to have returned to Australia and pose a security risk, and earlier this month the national security agency for the first time raised its four-tier threat level to "high". Highlighting the threat posed by returning fighters, Australia was swift to commit troops and aircraft to a U.S.-led coalition fighting Islamic State militants in Iraq and Syria earlier this month. United States and Arab allies on Tuesday bombed militant groups in Syria for the first time, killing scores of Islamic State fighters and members of a separate al Qaeda-linked group. More than 800 police were involved in a security operation in Sydney and Brisbane last Thursday, which authorities said had thwarted a plot by militants linked to the Islamic State group to behead a random member of the public. Security was also boosted at Parliament House in Canberra, after intelligence "chatter" had revealed a plot to attack the building and politicians on orders from overseas militants. (Editing by G Crosse and Andrew Hay)