UPDATED 02/24/11 4:21 p.m.

CHICAGO (CBS) — Authorities were investigating whether two Chicago police officers violated department policy when arresting a panhandler, who later started a shootout that led to his death on Wednesday.

Reginald Hardaman, 56, was killed by police after he pulled a gun inside a Chicago police car and fired shots at the two officers who had arrested him.

Sources said there’s no question about whether the shooting was justified. Anytime a person points a gun at police officers, the officers must protect themselves.

But, as CBS 2’s Suzanne Le Mignot reports, the two officers were under investigation for possible mistakes made when arresting Hardaman.

Sources said Hardaman, who was homeless, was wearing at least six layers of clothing Wednesday afternoon when the two officers confronted him about reports of aggressive panhandling.

Sources said the officers conducted a pat-down, but did not do a more thorough search of Hardiman as required by police policy.

“If they did their procedure, then how was he able to be in that car and still have a gun with his hands cuffed behind him,” Hardaman’s brother, Sidney Hardaman said Thursday morning.

Sources said Reginald Hardaman was handcuffed behind his back when officers placed him in the back of their vehicle, but was able to get out of his handcuffs and pull out a gun he had hidden against the small of his back. Sources said he also was carrying 20 bullets with him.

While the officers were driving, Hardaman fired between seven and eight shots from his revolver. One bullet went through the back of the driver’s seat.

Sources said it’s believed that seat saved the officer’s life. He only had a graze wound to his back. The other officer, who was sitting in the front passenger seat, suffered a hand injury from shattered glass during the shooting.

While the car was still in motion, the officers jumped out and started shooting at Hardaman from outside the car. Sources said the officers fired at least nine shots. Hardaman was hit four times.

Normal police policy is to never shoot at a moving vehicle, but there is a gray area in a case like this. If a suspect is shooting at an officer, all bets are off.

Officers are supposed to transport suspects in vehicles specifically designed for that purpose, like a squad car.

What officers do in practice in an unmarked tactical car is that, only in an extreme emergency, one officer drives, while the other sits with the suspect in the backseat, because there’s no divider.

The officers did not call for a transport vehicle to go to the scene on Wednesday, a procedure officers are supposed to follow to transport a suspect who has been arrested.

The Independent Police Review Authority must now investigate whether the two officers violated any department policies during the arrest.

Sources said what prompted the call to police about Reginald Hardaman was that he started begging inside nearby Moody Bible Bookstore, then reaching into customers’ pockets for money.

Sources said officers in the River North area knew Hardiman because of multiple previous arrests.

Sidney Hardaman told CBS 2’s Susanna Song that his brother, Reginald, had a history of mental illness. He said that Reginald was out on the streets because he couldn’t hold a job and that he suffered from a mental illness throughout his life.

“He had a slight mental illness. I don’t know whether he might not have been getting his medications, then, or whatever the situation might have been,” Sidney Hardaman said.

Sidney Hardaman acknowledged that his brother was a panhandler, saying he got money by picking things up off the street and selling them.

The shooting happened Wednesday afternoon in broad daylight in the bustling River North neighborhood just steps from the Moody Bible Institute.

“We were in the middle of praying, when all of a sudden, we heard a shot ring out,” witness Melissa Zaldivar told CBS 2’s Mike Parker.

Zaldivar witnessed the shooting from a window at the Moody Bible Institute. She and other witnesses say they heard about seven shots.

“The offender became combative with the 18th District officers and ultimately retrieved a weapon, and fired shots at the officers,” police Supt. Jody Weis said at the scene. “The officers immediately returned fire.”

Phil Lee, a film editor, was working in a fifth-floor office when he heard four or five shots, looked out the window and saw a gold Ford Crown Victoria squad car rolling slowly north on Wells before coming to a stop in front of the Moody Bible Institute.

“A cop shoots into the back seat on the driver’s side, opens the front door and sticks his head into the car, then pulls the guy out,” said Lee, who shot home video of the shootout.

A background check on Hardaman revealed he had a prior history with police. Dating back to 1990, it includes several misdemeanors and two felony cases.

In one of them, in 1991, he was convicted of attempted robbery and he was found unfit to stand trial for behavioral reasons.

The two officers involved are both veterans. One officer, 37, suffered a bullet wound to his back, and his 60-year-old partner suffered minor cuts to his hands from flying glass.

Both are expected to recover fully.

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