THE driver arrested after a car was driven into pedestrians in Melbourne was a 32-year-old Australian of Afghan descent with a history of drug use and mental health problems, and there is no evidence to suggest a link with terrorism at this stage, police said.
Police later said a second man had been arrested.
The force said: "Police have saturated the CBD (central business district) area following an incident where a car has collided with a number of pedestrians on Flinders Street.
"The incident occurred when the vehicle struck a number of pedestrians in front of Flinders Street Station just after 4.30pm.
"The driver of the vehicle and a second man have been arrested and are in police custody.
"A number of people were treated at the scene for a range of injuries and have been transported to hospital."
A woman called Sue told 3AW radio: "As it (the car) approached this intersection... it just mowed everybody down, people were flying everywhere."
And man who was working in a nearby shop, and was at the scene before emergency services arrived, told the Australian Associated Press: "There was no screaming, just people lying there."
Vince added that onlookers were "just holding them and comforting them".
Kyra Gillespie was one of "hundreds of people" who were told to get off trams near the area following the incident.
She told ABC News: "I think everyone is a little bit shaken up by the experience.
"Lots of people were phoning their loved ones to tell them they were OK."
Leader of the opposition Bill Shorten tweeted: "Shocking scenes in Melbourne this afternoon. Credit to first responders who are doing us proud once again. Thinking of everyone caught up in this atrocity."
Social media images from the scene showed casualties being treated in the street by paramedics.
A young man in jeans and a teeshirt could also be seen being arrested by three police officers on the steps of the station, although it was unclear if he had been in the car.
According to the AAP, a witness said the Suzuki was travelling at around 60mph.
"The intersection was full of pedestrians and he just ploughed through," the witness named Jim told ABC TV.
"The only thing that slowed him down was him hitting pedestrians.
"There was no braking, there was no slowing down. Whether it was targeted or whether he had a heart attack, or was drunk, I don't know."
A woman called Nicola told ABC News she initially thought a bomb had gone off.
She said: "I was waiting for the train and there was a big bang and lots of screaming.
"I thought it must be a bomb. I could just see dust rising and we were told to get away and stay in the station."
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