> because they would keep finding vulnerabilities in the phone system
that is certainly rewriting history there! The FBI was involved more than once, several young men went to jail over this. You said "loved" ? thats actually twisted to say that
The probably first reported hacking incident (in the modern sense, as in computer assisted phone phreaking) was at MIT using a PDP-1 to connect various tie-lines between MIT and Harvard, and reaching out on tie-lines to the Millstone Radar Facility, the Sudbury defense installation, IBM Kingston/NY, and to the MITRE Corporation, while redirecting the long distance call fees to a local radar station. As reported in "The Tech", 20 Nov. 1963 issue[0]. It doesn't seem that this had any serious consequences, though. Carlton Tucker, MIT’s telephone system administrator, is quoted with (while expressing warnings regarding future liabilities), "we don’t have too much trouble with the boys; we appreciate their curiosity."
I don't have a date for that story - but I would expect it was before the widespread adoption of Touch Tone in 1963... And maybe the authorities were more lenient then, as well as with faculty. I think this was probably late 50s or early 60s. I imagine DTMF was deployed at MIT before it was done nationwide. Not trying to rewrite history - just saying theres a lack of detail in my comment and yours.
that is certainly rewriting history there! The FBI was involved more than once, several young men went to jail over this. You said "loved" ? thats actually twisted to say that