CAMBRIDGE, Mass. -- Financial difficulties may have led to the deaths of a young mother and her 9-month-old baby in their Massachusetts bed last month, according to Middlesex County District Attorney Martha Coakley.

Coakley confirmed Thursday that Neil Entwistle, 27, was arrested in London by British authorities and charged with the murders of his wife and daughter.

Entwistle told a judge during an extradition hearing in England Thursday that he would not voluntarily agree to return to Massachusetts.

"I can't say he was surprised or unsurprised," Coakley said, speaking of Entwistle's arrest during a Cambridge, Mass., news conference.

"Neil Entwistle, having entered into some debt obligations in England, moved to the U.S. with his wife and child ... and may have found himself in financial difficulties," Coakley said.

Entwistle was arrested by London police and Scotland Yard at a subway stop Thursday after U.S. authorities obtained an arrest warrant for the murders of his wife Rachel, 27, and his baby, Lillian.

Entwistle is facing two charges of murder, one charge of possession of a firearm and one charge of possession of ammunition.

Coakley said investigators believe Rachel and Lillian were shot as they lay in bed early on the morning of Friday, Jan. 20, with a gun owned by Rachel Entwistle's step-father, Joseph Matturazo. She said investigators had evidence that Neil Entwistle had used the gun previously with his father-in-law.

"He shot Rachel Entwistle in the head and then proceeded to shoot baby Lillian, who was lying on the bed next to her mother ... we believe that this was intended to be a murder-suicide," Coakley said.

Coakley said detectives believe Entwistle returned the gun to his in-laws' house in Carver, Mass., after the killings and then boarded a plane for England from Logan International Airport at 8:15 a.m. the next day.

Coakley said Neil Entwistle's Internet business had failed and he was in debt, which may have led him to plan a murder-suicide.

"He owed money in London. He did not have a job. He did not have a visible means of support," Coakley said. "He was unable to provide income for himself or his family."

Rachel and Lillian Entwistle each died of a single gunshot wound, according to autopsy results. Rachel died from a gunshot wound to the head. Lillian was shot in the abdomen, but that bullet also entered her mother's torso.

Neil Entwistle, a British citizen, boarded the flight for England and was staying with his parents in their Worksop, England home. He did not return for the funerals of his wife and child which were held Feb. 1 in Plymouth, Mass.

The couple, who met while Rachel Entwistle was studying abroad at York University in England, had only been married for three years. Lillian was born last April.

Investigators had looked at the Entwistles' business dealings on the Internet, where they sold software and adult business opportunities on eBay. Prosecutors said they did not think any disgruntled customers were a factor in the murders. Instead, they said Neil Entwistle faced numerous financial problems that began in England and continued in Massachusetts, where neither Neil or Rachel had jobs but were renting an expensive suburban home. She said Rachel and her family may have been unaware there were financial problems.

"If their financial world around them was crumbling it appears that he may have been the only one who was aware of that," Coakley said.

In fact, she said, he had a tough time coming up with the money to buy a ticket back to England, but ultimately used a credit card.

Entwistle is scheduled to appear in a London courtroom Friday on an extradition warrant. It's not clear when he will be returned to the U.S. to face charges.