The shotgun used to kill one man and wound three police officers during the Brighton siege cost $2000 and was sold in a suburban carpark, a court has heard.
And the man accused of selling the gun told police he was concerned it was being bought by a member of the Apex gang.
George Matte-Hado, 36, faced the Melbourne Magistrates Court on Monday charged with six offences relating to the supply of a weapon allegedly used by Yacqub Khayre during the Brighton terror siege on June 5. He was arrested last Friday.
Police allege Khayre contacted another man, Burak Diler, on May 18 about acquiring the shotgun, and they discussed the purchase using coded language.
The next day, Mr Diler contacted Mr Matte-Hado, a family friend and former co-worker, about buying the gun: a Nikko 12-gauge shotgun.
Police allege Mr Diler told Mr Matte-Hado that the man who wanted to buy the gun was named "Yacqub", was African, and lived in Meadow Heights.
Mr Matte-Hado told police he then asked around to see whether the man buying the gun was a member of the Apex gang.
He could not find out any further information about the man, and agreed to continue with the sale, he told police.
He met Mr Diler in a carpark in the Greenvale Gardens housing estate, in Melbourne's outer north.
Mr Diler allegedly arrived a car driven by Khayre.
Mr Matte-Hado sold the gun, which he had wrapped in a mechanic's rag, for $2000, and then gave $300 back to Mr Diler for drugs.
Mr Diler is one of three other men charged with supplying Khayre with the guns used in the siege.
Mr Matte-Hado, a father-of-two from Greenvale, was "disturbed" when he learnt the gun had later been used by Khayre to murder receptionist Nick Hao and injure three police.
Another shotgun found after Khayre was killed in the shootout with police had not been fired during the siege.
The bail application before Chief Magistrate Peter Lauritsen continues.
More to come.