This happened recently at Reynisfjara Beach.
Rick mentions this several times in his Iceland guidebook. Yikes!
I have no doubt there are signs there warning of the SNEAKER waves. There are several beaches on the Oregon coast that are susceptible to these 'out of nowhere' waves and there are warning signs everywhere. But that doesn't stop people from ignoring them and getting caught, and in some cases swept away.
For some reason many humans have this tendency to think they are immortal (or special, or unique) and that those things that are warned about won't ever happen to them.
When I visited this beach at the end of October there were at least 100 people with their backs completely to the ocean, taking pictures of the cliffs and rock formations. I didn't see any sneaker waves, thankfully, but took the advice of the tour guide to walk on the dry sand (knowing that the waves hadn't reached that far, that day at least). For anyone who does visit this location, take the obligatory photos of the rock formations (with an eye to the water!) and then walk away from the crowds down the beach. You'll have the place to yourself and it's just beautiful (even in the rain).