I host my own modded server where I play locally with 2 other people.

We were sleeping at our base and when we woke up, I suddenly got a icon with house and X on it, second player got orange icon with bandit head and magnifying glass, and the third player got a green icon with 2 hands giving high-five.

Then bandits run upon us and were standing and aiming their weapons repeatedly and followed us and after a while they shot the second player, then after few minutes they shot and killed the third player (he had a zombie behind him, which they shot at) and lastly after a minute or so one of them turned to me and it's text turned red and he shot and killed me too. What was happening there? Is it a bug or something I don't understand.

EDIT: Is it supposed to be that all 3 players have different notification icons regarding same bandit group?