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On the afternoon of 31 May 1942, three Japanese submarines appeared some thirteen kilometres out from Sydney Harbour. Each one launched a midget submarine, aimed at the American heavy cruiser, the USS Chicago, which was anchored in the harbour. One midget was detected at about 8:00pm, but was not precisely located until it became entangled in the net; the two-man crew of the submarine blew up their own vessel to avoid capture. When the second midget was detected after 10:00pm, a general alarm was sounded. The third midget was damaged by depth charges, and the crew also committed suicide to avoid capture.

The second submarine then returned fire, hitting the naval depot ship HMAS Kuttabul. Nineteen Australian men and two British sailors on the Kuttabul were killed. The submarine is believed to have then returned to its mother ship, known as I-24.

I-24 returned nine days later, on 8 June 1942, and proceeded to attempt to fire at the Sydney Harbour Bridge. Every shot missed, but at least 10 shells hit the residential suburbs of Rose Bay, Woollahra and Bellevue Hill. All but one of the shells failed to explode and there were no fatalities or serious injuries.

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