Senior sources in the Metropolitan Police have told The Observer that members of the surveillance team who followed de Menezes into Stockwell underground station in London felt that he was not about to detonate a bomb, was not armed and was not acting suspiciously. It was only when they were joined by armed officers that his threat was deemed so great that he was shot seven times.

Sources said that the surveillance officers wanted to detain de Menezes, but were told to hand over the operation to the firearms team.

The two teams have fallen out over the circumstances surrounding the incident, raising fresh questions about how the operation was handled.

A police source said: 'There is no way those three guys would have been on the train carriage with him [de Menezes] if they believed he was carrying a bomb. Nothing he did gave the surveillance team the impression that he was carrying a device.'

Last night, Metropolitan Police chief Sir Ian Blair admitted he was told that shooting created 'a difficulty'.

In an interview with the News of the World, Blair said that an officer came to him the day after the shooting and said the equivalent of 'Houston, we have a problem'.

'He didn't use those words but he said "We have some difficulty here, there is a lack of connection". 'I thought "That's dreadful, what are we going to do about that?".'

The Observer can also reveal that the de Menezes family was offered £15,000 after the shooting. The ex gratia payment, which does not affect legal action by the family or compensation, is a fraction of the $1 million (£560,000) reported to have been offered the family. Police yesterday denied they had made the offer, which the family has described as 'offensive'.

Members of the firearms unit are said to be furious that de Menezes was not properly identified when he left his flat, the first problem in the chain of events that led to the Brazilian's death.

Specialist officers with the firearms team active that day had received training in how to deal with suicide bombers. A key element was advice that a potential bomber will detonate at the first inkling he has been identified. They are trained to react at the first sign of any action.

The Observer now understands that seconds before the firearms team entered the tube train carriage, a member of the surveillance squad using the codename Hotel 3 moved to the doorway and shouted: 'He's in here.' De Menezes, in all likelihood alarmed by the activity, stood and moved towards the doorway. He was grabbed and pushed back to his seat. The first shots were then fired while Hotel 3 was holding him.

The Independent Police Complaints Commission (IPCC) is to investigate if the firearms officers, with only seconds to decide whether to shoot, mistakenly interpreted de Menezes's movement as an aggressive act.

For the firearms officers involved in the death to avoid any legal action, they will have to state that they believed their lives and those of the passengers were in immediate danger. Such a view is unlikely to be supported by members of the surveillance unit.

For reasons as yet unclear, members of the firearms team have yet to submit their own account of the events to the IPCC. The two members of the team believed to have fired the fatal shots are known to have gone on holiday immediately after the shooting.

In one case, the holiday had been pre-booked, in the other the leave was authorised by Blair, who yesterday received the backing of the Home Secretary, Charles Clarke: 'I am very happy with the conduct, not only of Sir Ian Blair, but the whole Metropolitan Police in relation to this inquiry.'

Meanwhile, questions have been raised about the accuracy of the police intelligence that led to the raid on the block of flats occupied by de Menezes. It was initially suggested that the flat was connected to the man known as Hussein Osman, who was arrested in Italy. On the Saturday after the shooting, officers raided the flat in a high-profile operation watched by the world's media. As a result, a man, identified only as 'C', was arrested 'on suspicion of the commission, instigation or preparation of acts of terrorism'. But he was released on 30 July with no charge, raising the possibility that the flats had no connection with the bombings.

The IPCC is also expected to look into selective briefings to the media over the days following the shootings.

The parents of de Menezes said they have rejected all financial offers made by the police. 'I feel hurt and offended,' Jean's mother, Maria Otoni de Menezes, told The Observer this weekend. 'I didn't think it was right to talk about money so soon after my son's death.'

One document seen by The Observer and handed to the family on 1 August by the Met's assistant deputy commissioner, John Yates, sets out a final settlement, on top of an agreement to pay repatriation and legal fees. 'The MPS offers £15,000 by way of compensation to you for the death of Jean Charles,' says the document, dated 27 July. 'This ... extra gratia paymen ... means it is paid without any consideration of legal liability or responsibility.'