A man speaks to a security guard standing behind a closed door of a Banco de Madrid office in Madrid, Spain, Monday, March 16, 2015. Government-appointed administrators running the Spanish unit of an Andorran bank accused of money laundering say they have suspended its operations and filed for bankruptcy protection. Spain's central bank says a crush of withdrawals by clients of Banco de Madrid SA prompted the request to a judge for bankruptcy protection. The bank caters to wealthy clients and is owned by Banca Privada d'Andorra, which was named a "primary money-laundering concern" by the U.S. Treasury Department last week. (AP Photo/Paul White)
The Associated Press
MADRID (AP) - Andorra, a tiny principality in the Pyrenees Mountains in Europe, on Monday imposed withdrawal limits for clients of a bank accused of money laundering. The Spanish unit, meanwhile, has filed for bankruptcy protection and had its operations suspended after clients rushed to withdraw money.
Andorra's finance agency said it was immediately limiting the amount that clients of Banca Privada d'Andorra, or BPA, can withdraw from each account to 2,500 euros ($2,634) per week.
"The purpose of this measure is to preserve the interests of customers and ensure the stability and value of the organization, as well as to safeguard the stability and reputation of the Andorran financial system," the agency said in a statement.
Concern over the bank has risen since it was accused last week by the U.S. of helping groups from China, Russia and Venezuela launder money. Andorra has since then taken over the parent company and officials from Spain and Panama taken over the bank's Spanish and Panamanian divisions.
Separately, Spain's central bank said Monday that Banco de Madrid SA, a unit of the Andorran bank, needs bankruptcy protection granted by a judge following a "sharp deterioration" of its finances with "large withdrawals of clients' funds."
The Spanish central bank did not disclose how much money had been withdrawn from Banco de Madrid, which caters to wealthy clients and said last month that it managed 6 billion euros ($6.3 billion) in assets.
Employees were allowed to enter the bank's downtown Madrid headquarters branch Monday morning but a sign posted on the front door said it was closed for clients because of the central bank's bankruptcy protection request.
The central bank said Banco de Madrid deposits are guaranteed up to 100,000 euros ($105,000).
Spain's financial market regulator said it had temporarily suspended reimbursements of the bank's investment funds.
Also Monday, an Andorran police official said the chief executive officer of Banca Privada d'Andorra was taken to appear before a judge Sunday night after being arrested Friday on suspicion of money laundering. The official spoke only on condition of anonymity because of department policy.
Officials at Andorra's court said Monday that they had been instructed to give no information on what happened at the appearance of CEO Joan Pau Miquel Prats and also declined comment on whether he had been released from custody or not.
Tucked between Spain and France, Andorra has 85,000 residents and is a popular destination for skiing, shopping and banking.
A man speaks to a security guard standing behind a closed door of a Banco de Madrid office in Madrid, Spain, Monday, March 16, 2015. Government-appointed administrators running the Spanish unit of an Andorran bank accused of money laundering say they have suspended its operations and filed for bankruptcy protection. Spain's central bank says a crush of withdrawals by clients of Banco de Madrid SA prompted the request to a judge for bankruptcy protection. The bank caters to wealthy clients and is owned by Banca Privada d'Andorra, which was named a "primary money-laundering concern" by the U.S. Treasury Department last week. (AP Photo/Paul White)
The Associated Press
A security guard closes the door of a Banco de Madrid office in Madrid, Spain, Monday, March 16, 2015. Government-appointed administrators running the Spanish unit of an Andorran bank accused of money laundering say they have suspended its operations and filed for bankruptcy protection. Spain's central bank says a crush of withdrawals by clients of Banco de Madrid SA prompted the request to a judge for bankruptcy protection. The bank caters to wealthy clients and is owned by Banca Privada d'Andorra, which was named a "primary money-laundering concern" by the U.S. Treasury Department last week. (AP Photo/Paul White)
The Associated Press
A woman walks past some discarded balloons in a trash container outside a closed Banco de Madrid office in Madrid, Spain, Monday, March 16, 2015. Government-appointed administrators running the Spanish unit of an Andorran bank accused of money laundering say they have suspended its operations and filed for bankruptcy protection. Spain's central bank says a crush of withdrawals by clients of Banco de Madrid SA prompted the request to a judge for bankruptcy protection. The bank caters to wealthy clients and is owned by Banca Privada d'Andorra, which was named a "primary money-laundering concern" by the U.S. Treasury Department last week. (AP Photo/Paul White)
The Associated Press