Sydney: Two people were arrested on Tuesday in Australia`s New South Wales state for allegedly financing the Islamic State (IS) terror group.

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They were accused of being involved "in obtaining money to send offshore to assist the IS in its activities," said New South Wales state Police deputy commissioner Catherine Burns.

One of the two detainees, Milad Atai, 20, was under investigation for months as part of "Operation Appleby" which police began in September 2014 after discovering the alleged planning of a terrorist attack in the country.

Burns said that the case of the second detainee, a 16-year-old girl, is a serious matter and that police have begun analysing the factors contributing to the radicalisation of the minor.

"It is disturbing that we are continuing to see a trend of teenage children involved in activities that they should really not be involved in at all," Burns added.