One of the men killed in a suspected British terror attack has been described as a “wonderful man” as security sources reveal the man behind the attack was known to domestic spy agency M15.

James Furlong, 36, head of history and government and politics at The Holt School in Wokingham, was also remembered by his school colleagues as “talented and inspirational”.

His parents, Gary and Janet, said in a statement: “He was the best son, brother, uncle and partner you could wish for”.

“We are thankful for the memories he gave us all. We will never forget him and he will live in our hearts forever.”

Former students wrote on social media that Mr Furlong was someone who “could light up a room with his warm energy and jokes … he would always skip around school singing a tune”.

Another wrote that Mr Furlong “was one of the most influential and exceptional people in my life. He fostered my love of history, nurtured me, and taught me resilience and kindness”.

“The four years I spent with him were precious, and deeply treasured. I am absolutely devastated.”

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Mr Furlong, along with two others who have yet to be named, was killed in a random stabbing attack in a Reading park on Saturday. Two others were injured and remain in hospital; a fourth person has been discharged.

The 25-year-old suspect, who was arrested by police a short distance from the scene at Forbury Gardens minutes after the attack, is understood to be named Khairi Saadallah.

He was arrested on suspicion of murder.

He was later re-arrested under Section 41 of the Terrorism Act, which gives police the power to detain him without charge for up to 14 days.

It emerged on Sunday that Mr Saadallah, a refugee of the civil war in Libya, briefly came to the attention of MI5 in 2019, but the information provided did not meet the threshold of investigation.

Britain’s national news agency PA understands from security sources that M15 had received intelligence Mr Saadallah planned to travel abroad, possibly for terrorism purposes, but the threat was found to be insubstantial.

As counter-terror officers investigate, mental health is understood to be considered a major factor in the latest incident.

Police are not looking for anyone else in connection with the attack.

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Prime Minister Boris Johnson said he was “appalled and sickened” by the incident and said “we will not hesitate to take action” if there are lessons to be learned from the circumstances.

The suspect was jailed in October for a complex series of non-terror offences before his sentence was reduced to one of 17 months and 20 days’ imprisonment in the Court of Appeal.

One of the appeal judges who gave the judgment in March, Mr Justice Goss, noted Mr Saadallah’s various mental health issues in reducing the sentence.

Mr Saadallah was released from prison in early June, it is understood, and the COVID-19 pandemic played no part in the decision to free him.

The Sun reported that he left the Bullingdon prison in Oxfordshire, 17 days ago.

Police converge on the scene of the grisly attack in Reading. Photo: AAP

Security guard Sydney McDonald, 65, who saw the suspect being rugby-tackled to the ground by police described how it looked as if he had put his hands “in a big bucket of red paint”.

Personal trainer Lawrence Wort, 20, who said he was about 10 metres from the incident, told PA on Saturday the suspect was alone and “shouted some unintelligible words” before launching the attack.

“He went around a large group of around 10, trying to stab them,” he said.

“He stabbed three of them, severely in the neck, and under the arms, and then turned and started running towards me, and we turned and started running.”

Heavily armed police raid a block of flats not far near the Reading park where the attack happened. Photo: AAP

Thames Valley Police have pleaded with the public not to share pictures or images of the killings on social media.

Despite treating the incident as a terror attack, Metropolitan Police Assistant Commissioner Neil Basu said on Sunday the motive was still “far from certain”.

Mr Basu said there was no evidence to suggest anyone attending crowded places was at risk, but asked people to “be alert, not alarmed, when you are in public”.

-with agencies