Phone tap consoles are usually built in a security room. They require a guard and electricity to operate. They must be connected to phone booths or visitation booth in order to tap into that particular phone booth's calls.
When a booth with an ongoing call is found the cycling stops and the guard listens to that phone call. If a call is being monitored, the light on top will appear green. If no call is being monitored, the light will appear yellow. Please be aware that a Guard listening to a Phone Call will not stop other Guards from listening to the same Phone Call. This causes multiple Phone Taps connected to a bulk of phones to be ineffective.
The information gathered from phone taps will not be utilized automatically by the guards or given to the player. You will have to check the Informants view in the Intelligence menu regularly to make use of this feature.
It is a good idea to run your phone taps on an isolated electrical line and then put a switch and a door timer on it. That way you can automatically disable phone taps when they are not needed, which will free the guards controlling them.