With recent advances in both AI and IoT capabilities, it is possible than ever to implement surveillance systems that can automatically identify people who might represent a potential security threat to the public in real-time. Imagine a surveillance camera system that can detect various on-body weapons, masked faces, suspicious objects and traffic. This system could transform surveillance cameras from passive sentries into active observers which would help in preventing a possible mass shooting in a school, stadium or mall. In this paper, we present a prototype implementation of such systems, Hawk-Eye, an AI-powered threat detector for smart surveillance cameras. Hawk-Eye can be deployed on centralized servers hosted in the cloud, as well as locally on the surveillance cameras at the network edge. Deploying AI-enabled surveillance applications at the edge enables the initial analysis of the captured images to take place on-site, which reduces the communication overheads and enables swift security actions. At the cloud side, we built a Mask R-CNN model that can detect suspicious objects in an image captured by a camera at the edge. The model can generate a high-quality segmentation mask for each object instance in the image, along with the confidence percentage and classification time. The camera side used a Raspberry Pi 3 device, Intel Neural Compute Stick 2 (NCS 2), and Logitech C920 webcam. At the camera side, we built a CNN model that can consume a stream of images directly from an on-site webcam, classify them, and displays the results to the user via a GUI-friendly interface. A motion detection module is developed to capture images automatically from the video when new motion is detected. Finally, we evaluated our system using various performance metrics such as classification time and accuracy. Our experimental results showed an average overall prediction accuracy of 94% on our dataset.