The ringleader of the terrorists who carried out the London Bridge attack was known to the police and MI5 for Islamist extremism before he went on his rampage of murder and maiming, Scotland Yard has acknowledged.

However, the security agencies insisted there was nothing to suggest that 27-year-old Khuram Butt, a British national born in Pakistan, had been planning acts of violence and thus he did not warrant being put under close surveillance.

Rachid Redouane, a 30-year-old Moroccan holding an Irish passport, who had also claimed to be a Libyan called Rachid Elkhdar, was another of the killers. He had not previously come to the notice of the authorities. The identity of the third member of the group, who is not believed to be a UK citizen, is yet to be disclosed.

Butt and Redouane, who were both married, lived in Barking, east London, and are believed to have been part of a jihadist network based in the area who helped them plan the assault in which a van was used to mow down people, followed by a stabbing spree.

Seven people were killed and 48 injured in the attack before the three terrorists were shot dead by armed police.

Butt, who wore an Arsenal football shirt while he and his two companions hunted and hacked down members of the public, had appeared in the past in a Channel 4 documentary, The Jihadis Next Door, about the presence of violent Muslim extremists in British cities. He was seen in the programme among a group of men unfurling a black Islamist flag and then in a confrontation with the police.

Butt was thrown out of a mosque in east London after confronting the imam and espousing hardline fundamentalist views. He had also been reported twice to the police – once for accessing online Islamist propaganda and the second time for attempting to indoctrinate children.

He is said to have returned for Friday prayers the day before the London Bridge attack and one worshipper said he believed the mosque's imam knew the attacker's name.

But officials would not confirm Butt – known to friends and neighbours as Abz – had attended and asked The Independent to leave.

Michael Mimbo was a neighbour of attacker Khuram Butt, who he knew as Abz (Lizzie Dearden ) (Lizzie Dearden)

A man coming out of prayers on Monday said he hoped the local Muslim community would not be demonised.

"He had nothing to do with these people [at the mosque]" he added.

"They [attackers] are deranged, mentally disturbed."

Another worshipper leaving the mosque said the terrorists were "not Muslims".

"I don't believe they are Muslims who are doing this," said Mukhles Chowdhury.

"Islam doesn't allow for this. This isn't religion – it is terrorism and we must come together to stamp it out.

"We have to find these people and hand them in."

Assistant Commissioner Mark Rowley, of the Metropolitan Police, acknowledged that Butt was known to MI5 and the police. But, he continued “there was no intelligence to suggest that this attack was being planned and the investigation had been prioritised accordingly … Work is ongoing to understand more about them, their connections and whether they were assisted or supported by anyone else.”

Timeline: Police release 12 people held after London atrocity and name two attackers

Redouane, who had worked as a pastry chef and is believed to have a Scottish wife, had lived in Dublin before coming to London. The Gardai say he was not suspected of any subversive activity while living there. UK security agencies have been liaising with counterparts in Belgium and France where people from Moroccan background have carried out a number of terrorist attacks.

Butt’s family came to Britain from Pakistan when he was a child. He had been married for three years to a Pakistani woman called Zahra and has two children, a two-year-old boy and a two month old daughter. He obtained an NVQ Level 2 In business administration and went on to work in an administrative role for a company called Auriga Holdings based in East Ham which manages Kentucky Fried Chicken outlets. He had also worked in a customer services role for Transport for London and was the sole director of a company, now dissolved, called Kool Kosmetic

Butt, it has been claimed, knew Anjem Choudary and members of his group al-Muhajiroun. Choudary was sentenced to five and a half years in prison in September last year for supporting Isis. There are also reports, unconfirmed, that he had met Siddhartha Dhar, a Hindu who converted to Islam and joined Isis in Syria.

Butt appears in the Channel 4 programme alongside Mohammed Shamsuddin who had praised Isis and declared that the flag of Islam would fly over Downing Street. Another Islamist, Abu Haleema, who had demanded that homosexuals should be killed and declared that the Bataclan massacre in Paris was justified, is also seen in the documentary.

Butt had been reported to the police by a former friend for comments justifying terrorist attacks. The friend claims that Butt had become an avid online follower of Ahmad Musa Jibril, an American Muslim cleric who preached jihad against unbelievers.

“I phoned the anti-terror hotline. I spoke to the gentleman. I told him about our conversation and why I think he was radicalised,” said the friend who did not want his identity publicised.

“But he was not arrested and was allowed to keep his passport. I did my bit, I know a lot of other people did their bit, but the authorities did not do their bit.”

The entrance to Jabir Bin Zayd Islamic Centre in Barking, where Khuram Butt prayed (Lizzie Dearden ) (Lizzie Dearden)

Erica Gasparri, from Italy, who lived near Butt said she too had reported him to the police for trying to “ brainwash” her children into becoming Muslims. She said: “He was trying to radicalise the children, he would go down to the park and talk to them about Islam. He also came to the houses and gave the kids money and sweets during Ramadan.”

Ms Gaspari recalled that the police had said her concerns had been passed on to the appropriate officials, but she did not hear anything more about the matter.

Michael Mimbo, who lives across the road from the man he knew as Abz, said he noticed the hired vehicle on Friday.

"It was blocking the middle of the road outside the flats," he told The Independent.

"A car beeped at him to say 'move' and he responded quite aggressively.

"I was walking past and thought he was moving out or his car had broken down or something – for him to react like that."

Mr Mimbo identified the van in photos of the aftermath of the attack on London Bridge, when it was rammed into pedestrians before Butt and the two other men emerged with knives and went on the rampage in nearby bars and pubs around Borough Market.

Neighbours last saw the van on Saturday afternoon, when it sped the wrong direction down the one-way road as children were playing.

At one point it was followed by Butt’s red Peugeot, which was left at the flats and has been taken away by police.

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Armed officers raided the attackers’ home in the early hours of Sunday morning, detaining several family members including Butts’ wife and mother.

Last night they were among 12 people who were released without charge, having been arrested in connection with the attack following searches at properties in Barking and nearby Newham.

Neighbours described the family as friendly and polite, but in recent months some parents had raised concerns about "brainwashing" after their children came home saying they wanted to become Muslims.

Mr Mimbo said Abz never spoke to him about religion and politics, mainly sticking to their shared passion for Arsenal or passing the time of day at a nearby gym.

But he recalled him appearing increasingly devout in recent months, growing his beard longer and starting to regularly wear traditional Islamic dress.

"Football was his thing – when I saw that picture of him [shot on the ground] I recognised his shirt," Mr Mimbo said.

"I thought maybe he was just devoting himself a bit more and becoming more religious.

"But I never, ever would have expected this – we didn't have a clue that he was capable of this."

Neighbours were woken by in the early hours of Monday morning by a separate police raid in Caledon Road, East Ham, where further arrests were made.

"It sounded like an explosion," said a 22-year-old resident, who did not want to be named.

"Then we heard bang, bang, bang, bang – it was frightening."

Ben Tamaklo, who lives on the residential street, said he looked out to see armed police swarming the street.

"We were shocked because we thought nothing was wrong in this area," he added.

Another neighbour, who has lived on the street since the 1970s, said he saw four members of a family being taken away – two brothers, their sister and their mother.

"I thought they were a good family," he told The Independent.

Crowds gather for vigil honouring victims of London Bridge attack Show all 8 1 /8 Crowds gather for vigil honouring victims of London Bridge attack Crowds gather for vigil honouring victims of London Bridge attack John Loughrey lays down flowers in Potters Fields Park, central London in honour of the London Bridge terror attack victims PA Crowds gather for vigil honouring victims of London Bridge attack People queue to lay flowers after a vigil for victims of Saturday's attack in London Bridge, at Potter's Field Park in London AP Crowds gather for vigil honouring victims of London Bridge attack Mayor of London, Sadiq Khan (centre) British Home Office Secretary, Amber Rudd (right) and British Shadow Labour Home Secretary (left) Diane Abbott arrive with flowers EPA Crowds gather for vigil honouring victims of London Bridge attack School girls look at flowers at a vigil in Potters Fields Park, central London, in honour of the London Bridge terror attack victims. PRESS ASSOCIATION Photo. Picture date: Monday June 5, 2017. See PA story POLICE Bridge. Photo credit should read: Nick Ansell/PA Wire PA Crowds gather for vigil honouring victims of London Bridge attack Floral tributes left for victims of Saturday’s London Bridge attack AP Crowds gather for vigil honouring victims of London Bridge attack People pay their respects, leaving floral tributes after a vigil for victims of Saturday’s attack in London Bridge AP Crowds gather for vigil honouring victims of London Bridge attack People queue to honour those killed on Saturday. Police have arrested several people and are widening their investigation after the attack AP Crowds gather for vigil honouring victims of London Bridge attack Tributes lie outside City Hall in London EPA

"I talk to the dad a lot because he's from Lahore in Pakistan and I'm originally from India.

"I used to see him going to Friday prayers, he seemed nice."

The man believed the "religious" family had been living at the house for six to eight months, saying the mother wore full Islamic dress including a black niqab covering her face, while the brothers both had beards and all dressed traditionally to go to the mosque.

Plain clothed detectives were seen leaving the house carrying evidence bags as part of the residential road remained cordoned off, with the windows of the raided house boarded up.

It lies a short distance from a row of shops where armed police threatened to shoot a man attempting to escape out of a flat window on Sunday. He was later detained.