Cold War tensions spiked in 1977 as the Soviet Union broke ground on its new embassy compound by the U.S. Naval Observatory. Media reports fearfully prophesied about the spy implications of the project.
“Laser-beam listening devices now are being installed by Soviet technicians. They have a clear line of sight to the White House and the Capitol. Aimed at windowpanes, the superbugs will be able to pick up conversations in all the rooms with north-facing windows,” the Orlando Sentinel wrote in 1985.
The United States intelligence community responded with a surveillance counterattack. Operating under the moniker Operation Monopoly, the FBI and NSA purchased the three-bedroom house next door and began to tunnel under the communist envoys.
The name Monopoly is great, because it referenced the two real estate deals while simultaneously trolling the Soviet’s economic worldview.
The envisioned subterranean listening spot would let agents eavesdrop on electronic communications in the building above. The plan seemed workable—the United States had a track record of pulling off comparable missions in East Berlin and outside Moscow.
However, costs began to add up as the tunnel progressed further and further toward the embassy. The total bill for this 300-foot passageway likely amounted to “several hundred million dollars,” according to a 2001 New York Times article.
Operation Monopoly ended up failing on two fronts. First were the technical problems like flooding and buggy NSA equipment. The Spy Museum quotes FBI assistant director John F. Lewis as saying that the tunnel produced “no information of any kind.” Secondly, the covert construction project was betrayed to the Soviet’s by Robert Hanssen, a double agent at the FBI (although this leak only came to light in 2001).
An article in the Washington Post last February located the exact house at the intersection of Fulton Street and Bellevue Terrace (they also wrote that the tunnel had been sealed with concrete). An in person visit in August 2016 revealed that the house has recently been demolished and all that remains are the concrete foundations.