MELBOURNE — Three men who allegedly plotted "chilling" terror attacks in Melbourne were arrested early Tuesday, less than two weeks after a stabbing rampage inspired by the Islamic State group left two dead in Australia’s second city, police said.

The trio, all Australian nationals of Turkish descent, were detained by counter-terror police in overnight raids as they escalated preparations to attack crowded areas of Melbourne, according to police.

The men were "certainly inspired by ISIS", the Islamic State group, but had no known links to a specific organisation, Chief Commissioner Graham Ashton said.

The three, who were not named but included two brothers, had been under investigation since March but had become "more energised" since the IS-inspired stabbing attack in Melbourne on November 9, Ashton said.

The men had sought to purchase semi-automatic .22 calibre rifles and police were concerned they could target upcoming Christmas season events that will see huge crowds gathering in the city.

"There was a view towards a crowded place, a place where maximum people would be attending, to be able to kill, we allege, as maximum an amount of people as possible," Ashton told reporters.

The group had not yet picked a specific target or time for the attack, and Ashton added that police were confident Tuesday’s arrests had "neutralised any threat to the... community from this group".

In the November 9 attack, a Somali-born Australian, Hassan Khalif Shire Ali, stabbed and killed one man and wounded two others in a central shopping area before being shot dead by police.

Coincidentally, the victim of that attack, Sisto Malaspina, 74, was honoured by a state funeral in Melbourne on Tuesday.

Hundreds of Melbournians and dignitaries attended a service at Melbourne’s St Patrick’s Cathedral to bid farewell to Malaspina, the beloved owner of a local Italian cafe and a well-known figure on the city’s vibrant restaurant scene.

The three arrested men were aged 30, 26 and 21, and will be charged in a Melbourne court later in the day with terrorism-related offences that carry a potential penalty of life in prison, police said.

"If we had not acted early in preventing this attack, we’ll allege the consequences would have been chilling, with... a potential significant loss of human life," said Ian Mccartney, a federal counter-terror police spokesman.

Australian police have charged 90 people in relation to 40 counter-terrorism investigations since 2014, when the country’s terror alert level was raised to "probable".

Melbourne has been the target for a number of attacks and plots.

In addition to the November 9 knife rampage, a 28-year-old man was convicted on six counts of murder last week for mowing down dozens of people in the same street in January 2017, and another man is in jail awaiting trial for a plot to cause mass casualties in the city’s Federation Square.

Shire Ali, like the three men arrested Tuesday, had his passport cancelled to keep him from joining ISIS in the Mideast, and Ashton said this may have led to their actions at home.

"Unfortunately, the ISIS propaganda machine and that of al-Qaeda promotes this type of activity so when people are prevented from travelling or it’s difficult to get to the conflict zone, often the view will be to change tack and commit an act in the country in which they live," he said.

Police said the probe which led to Tuesday’s arrests had been complicated by their use of encrypted messaging applications, an element certain to fuel debate about government attempts to force device makers and telecom companies to grant access to the applications. — AFP