That would have been on Western Electric "dumb" phones owned by the local Bell Telephone company. The microphone was wired through the keypad. Shorting the microphone to ground was like making the pulse contacts of a rotary dial thus making calls.
Smart (privately owned) payphones have the microphone wired through the smart circuit board not the keypad. The smart board can detect this type of fraud. Depending on how the phone owner configures the smart board security options, the phone can immediately call it's owner or dial 911 and report the fraud attempt or it can simply log the time, date, & duration of the fraud attempts. Then when the phone owner's computer calls the payphone for it's daily (or weekly) polling, the phone will report the fraud attempts. At no time will a smart phone ever allow dialing of calls through shorting out the microphone. Smart boards also have burglar alarm functions built-in since they are already hard wired to a phone line. Many smart payphone models have alarm switches on the locks so they can tell if someone has broken in. If someone crowbarred open a payphone coin vault door, the alarm switch will trip and the phone immediately dials the local 911 center and announces in a recorded voice "break-in, coin vault, payphone number (area code, then phone number)". Many 911 call dispatch centers have lists of payphones showing the payphone number, it's location, and who owns the payphone. The police are immediately dispatched to that phone
The Bell Telephone company's wised up to this type of fraud, too, and revised their dumb circuit boards and keypads to stop this fraud.