Police arrest mall shooter, hostages freed

PHOENIX (Reuters) - Police arrested a gunman who barricaded himself inside a Phoenix valley fast-food restaurant with hostages, after exchanging shots with officers outside a shopping mall, police said on Wednesday.

Chandler Police Department spokesman Joe Favazzo said the gunman gave himself up to police. At least two hostages were released.

"We've had a peaceful resolution. No-one has been injured," Favazzo told Reuters.

U.S. Marshals Service spokesman Jeff Carter said the incident began when police tried to arrest a suspect, Daniel Perez, who was wanted for shooting at Arizona Department of Public Safety officers last month.

The suspect fled into the Chandler Fashion Square Mall, which was immediately placed on lockdown, before barricading himself in a Baja Fresh Mexican Grill restaurant nearby with several hostages.

Police set up road blocks and were directing traffic away from the mall perimeter.

Kevin Lauchilin, a salesman at La-Z-Boy furniture store told Reuters he saw people streaming out of Dillards department store at the mall.

"It didn't seem like people were panicking. It's just not normal for that many people to be coming out at that time," he said.

Chandler police were unable to confirm that Perez was the suspect.

He is accused of shooting at Arizona Department of Public Safety officers outside a house in Casa Grande, south of Phoenix, on December 10.

He was accidentally released six days later by the Pinal County Sheriffs' Office on a $320 bond, after they did not receive paperwork, a spokesman for the sheriff's office said.

"He shot at two Department of Public Safety officers and should be considered armed and very dangerous," spokesman Tim Gaffney told Reuters.

(Additional reporting by Tim Gaynor and Dan Whitcomb; Editing by Greg McCune and Jerry Norton)