Three-way call detection is an important component of correctional facility telephone equipment because it helps restrict calling access by certain persons to certain restricted telephone numbers. Various three-way call detection methods exist, but all of these implementations suffer from one major limitation—the detection accuracy is not as high as is desired by the industry. The present invention improves detection accuracy, using “steganography.”Steganography involves hiding one set of data or signals within another signal or carrier in such a way that its presence is virtually imperceptible to the end recipient, and potential even the originator of the carrier signal. Television producers use steganographic methods to encode data in video signals for security, distribution monitoring, piracy-control, and other reasons. The present invention involves a device that connects to a telephone, either at the line or handset interfaces, and produces a known signal that is steganographically hidden within the user's normal voice signal. Detection equipment, residing at another location, monitors signals on telephone calls and tests for the presence of the hidden signal or data generated by the invention. Once detection is achieved, appropriate action, such as terminating or recording the call, may be taken. Improved accuracy is achieved by choosing the appropriate hidden signal(s)—ones that never occur in the course of normal conversation and never get generated by telephone company equipment. Once detected, the presence of the signal guarantees the call was made to the restricted party from a particular phone line.