Financial counsellors say live online gambling is the "frightening future of gambling" and are calling on the Government to rein in the big sports betting agencies who are using dubious practices to lure in and then bankrupt punters.

Live or "in-play" gambling allows punters to bet on events as they happen.

It is only legal to bet on live events in person or on the phone, but some companies are getting around this rule by instructing clients to simply turn on the microphone on their computer or mobile app.

Pam Mutton, a financial counsellor specialising in problem gambling at the Bentleigh Bayside Community Health Centre in Melbourne, said this type of gambling was dangerous.

"I think it's the most dangerous form of online gambling we are about to face," she told 7.30.

"I don't think it has really hit as an issue just yet, but the escalation of it will make pokies look like a picnic."

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Ms Mutton was appalled by the tactics sports betting companies are using to lure punters.

"It's fast. It's online. It's wherever you are. It's on your phone. It never goes away," she said.

"It's constantly sending you emails and requests — 'have a punt on this'."

Independent Senator Nick Xenophon wants the big sports betting agencies reined in, particularly where they are offering punters loans without the usual credit checks.

"This practice of unsolicited offers of inducements is absolutely predatory by these companies and it's allowed under Australian law," Senator Xenophon said.

"The great irony here is that a bank, any financial institution, must be governed by provisions of consumer credit legislation and yet these companies can offer massive amounts of credit.

"And people can get into a lot of trouble very quickly without any regulatory framework because they are not charging interest."

Anthony Robinson always enjoyed a punt but six years ago he began betting online and his gambling quickly got out of control.

"It escalated from May through to November; from a $5,000 original credit limit I'd spent $980,000," he said.

He was targeted by various sports betting agencies that treated him like royalty until the money ran out.

"They will take you to footy, I've been to Bledisloe Cup matches, I've been to AFL matches, racing carnival in the VIP tents and all this rubbish," he said.

"And it's all to say, 'Hey, why don't you deposit another bet today'."

His gambling cost Mr Robinson two relationships and a successful business.

"It doesn't seem like real money until your wife walks out the door and the kids leave — then it seems real," he said.

Government announces review of gambling legislation

His story is painfully familiar to Melbourne mother Francesca, whose son sold his house for $150,000 and then lost the lot on just four AFL matches.

"When he told me, my blood had run cold — from my head down to my toes, I was just frozen," she said.

"I couldn't believe it and I said, 'Oh son, why would you bet that type of money?' and he said, 'I don't know, Mum'.

Pam Mutton says "in-play" gambling is the most dangerous form of gambling. ( ABC )

"My husband had walked out and he was walking down the drive and I followed him and all I could see was his crying.

"He felt such a failure. Why didn't we know what was going on?"

Her shock soon turned to anger and she contacted a manager at Sportsbet, the agency her son was using.

"I told him what my son had done, how he'd lost all this money on Sportsbet, and it was wicked of them to take huge amounts of money off anybody and they lose it all in one go and its crazy," she said.

"Who does that? What government allows people to lose all that money?"

The Federal Government has announced a review of online gambling legislation to be headed by Social Services Minister Scott Morrison.

But Senator Xenophon said he was concerned it would not go far enough.

"This inquiry only does half the job because half of the money lost in online gambling in this country comes from authorised sites," he said.

"That's a billion dollars a year. To ignore those sites and to only focus on the illegal sites overseas is really a copout."

If you have a problem with gambling, you can get support and counselling on 1800 858 858 or through http://www.problemgambling.gov.au/