It is stated when a character dies they leave behind the body and anyone can loot the body. They will get something random but everything else is gone.
I have seen in other games the harvest or craft grief gangs. Basically kill a harvester or crafter. The killer is insta-killed, but someone nearby loots the body instantly (not allowing the original person time to recover.)
Will there be penalties for this? Even if the loot is random, making someone lose a bunch of crafted or harvested stuff is fun for griefers.