I'd check with someone in the bank who would be EXPECTED to know about this. It smacks to me of one unknowledgeable person hearing of another person's account being frozen due to fraud, and extrapolating that incident to all tourists.
I emphasized "expected to know" because I once asked a bank clerk in the international department of our local bank for some European currency. She asked, "Is theirs different than ours?". I knew then, right department, wrong person.

janisj, sorry, but I'm hardly a novice when dealing with ATM withdrawals in Spain. We did the transaction in Spanish, but it switched to English when the debit card was entered. In this case we requested a receipt because it seemed strange. The exchange rate, printed on the receipt, was slightly over 1.52 when the official exchange rate for that day was just under 1.47, which is what it came out to when we used the BBVA ATM machine on the next block.

The Bank of Santander is associated with an American bank that is currently in financial trouble because of the loan crisis. It could be they need the cash themselves.

Some credit unions and banks do indeed block card usage in certain countries where they have experienced high rates of fraud. Our CU blocked card usage for Italy. You need to read your disclosure.

Dandyj

You work at the bank?
I too work for a bank and am a customer as well.
I would never think to tell a customer that "all atm withdrawals in Spain are currently blocked"
without a specific reason.
A "regular" customer would demand a reason.

Of course there is a reason they just did not give it to you.
Call again, escalate the question to a manager and get the answer.

Does your bank have a branch in Spain? If so are they blocked at any Spanish bank's atms?

I personally have not run into this problem and our customers use atms all over the world.

Some important detail is missing here.

I remember just a bit ago I have a friend who works for a very large credit union in our area. She was born and raised in Spain but lives in my city now.

She and her husband went to Italy and they had no problems using the credit union ATM cards. When they arrived in Spain where they would be as they were visiting her family their credit union ATM cards would not work. If memory serves me right she ended up borrowing money from her family. After they left Spain they visited Portugal and their credit union ATM cards worked fine in Portugal.

I never did learn what caused the problem in Spain as we haven't talked in ages. It sounds however the credit union (her employer) blocked the use of ATM cards in Spain.