One of Europe's top currency forgers has been arrested, Spanish police said.

The 60-year-old man, whom police called "a real artist" of counterfeit money, had worked with such a degree of perfectionism that his €50 note ranked among Europe's top 10 imitation bills.

Following a year-long investigation, officials from Spain's national police and Europol detained the man on Monday in the garage of his house outside Toledo.

"It would be easy to fool anyone with these bills. They're very well done," said a chief inspector with the investigation, adding that the man was a self-taught graphic artist who had previously worked in the printing business.

Police said the quality of the man's bills – and the sheer volume he produced – had made him one of the top counterfeiters in Europe. "This type of counterfeiter," said the inspector, "they have a big ego and a big drive to excel. Logically they keep trying to outdo themselves because its an illegal product and the better it's made, the more popular it will be on the black market."

The garage of the man's modest home had been turned into a workshop, with every inch of its cramped, messy space filled with printers, stamps and ink cartridges. Police also seized a homemade oven, described as a type of microwave, designed to dry the counterfeit notes.

Full pages of printed-out €50 notes sat on a worktable, waiting to be cut. Crumpled-up printouts of rejected notes sat in the rubbish bin.

Along with his signature €50 notes, police found stacks of dollar bills, which will be sent to the US for further analysis. A box full of printer paper was also seized, with the heads of former American presidents embossed several times on each page. Police say the man also falsified passports for various European countries.

His euros crisscrossed the continent, ending up as far as Germany and Romania. Police were able to recoup counterfeitedimitation notes worth €310,000 (£255,000) but estimate that €1m of counterfeit notes is still floating around Spain and potentially the rest of Europe.

The reach of the man's notes was even more impressive for the fact that he had only started counterfeiting two years ago. Police said they put an end to his counterfeiting career at a critical point, just as he was about to multiply his business threefold.

Four others were arrested as part of the operation, including the man's 45-year-old wife. The three others, said police, worked to introduce the counterfeit notes into the economy.

More arrests are expected in the case, as police believe the man worked with a team of about 30 people.