He is said to have spread his extremist views to youngsters in a park on his estate in Barking, east London, after giving them sweets.
Mother-of-three Erica Gasparri, who lives on the estate, confronted him after her son came home and told her: "Mummy, I want to become a Muslim."
She reported the jihadist to police in 2015.
He would go down to the park and talk to them about Islam
Ms Gasparri told the Telegraph: "To me, my first impression was that he was a terrorist radicaliser.
"He told me he would do 'Whatever is required in the name of Allah… I would be prepared to kill my mother'.
"He was trying to radicalise the children, he would go down to the park and talk to them about Islam.
"He also came to the houses and gave the kids money and sweets during Ramadan."
The terror suspect tried to radicalise children on his estate, reports say London terror raids Sun, June 4, 2017
Police have raided a block of flats in Barking in connection with last night's London Bridge terror attack.
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As police continue their investigations following the June 3 terror attacks, a block of flats in Barking is raided for possible suspects
She added: "Those men I had never seen them in the park before, and I said to them: 'What are you doing here, why are you doing to this to the kids?’
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"He said: 'Are you a Muslim or a Catholic?'
"I said: 'It doesn't matter, I know about Islam, and it's not what you're doing'."
He is believed to have lived at the Elizabeth Fry Flats in Barking, London
Ms Gasparri, who handed images and videos of the man to police, said she was "furious" at their lack of action.
She said: "They [the police] were very concerned about it.
"They told me to leave the photos for my own safety, but then I heard nothing."
Erica Gasparri said she reported the alleged jihadist to police in 2015
The identity of the man has not been confirmed by the Metropolitan Police, which has launched a major probe into the attacks.
Seven people were killed in the atrocity on Saturday night, with a further 21 people fighting for their lives.
Pedestrians were mowed down by a van on London Bridge before the knife-wielding attackers caused carnage around nearby Borough Market.
One of the attackers shouted "this is for Allah" as he knifed a man near a pub, according to horrified eyewitnesses.
Seven people were killed and 21 critically injured in Saturday’s attack
The first victim of the attack has been named as Canadian national Christine Archibald, who moved to Europe to be with her fiance.
Her family said in a statement: "We grieve the loss of our beautiful, loving daughter and sister.
"She had room in her heart for everyone and believed strongly that every person was to be valued and respected."
A French national is also among the victims.