It sounds like you are using OldManWhistlers party loot notification system? If so, you'll want to go into the omw_plns script and change the settings for the PLNS_GOT_ITEM and PLNS_LOST_ITEM variables.
For example, this is what I use on my server for those settings so only DMs within 20 meters get notification of a PC acquiring or dropping something:
// Redefine these variables to change how loot notification is displayed.
// Open the LogMessage script to see the various different possible values
// for the LOG_* constants. By using LogMessage you have easy and complete
// control for how messages are displayed to the end users
int PLNS_GOT_ITEM = LOG_PARTY_PERC | LOG_DM_20 | LOG_TIME_SERVER_LOG;
int PLNS_LOST_ITEM = LOG_PARTY_PERC | LOG_DM_20 | LOG_TIME_SERVER_LOG;
You can find all the available settings for those variables in the omw_logmessage script:
// ****************************************************************************
// ** BACKWARDS COMPATIBILITY
// ****************************************************************************
// These globals exist purely for backwards compatibility with older versions
// of LogMessage. They aren't recommended.
// Send only to the oPC who activated it (floating text) and the server log file
int LOG_FILE_PC = LOG_TO_SERVER_LOG | LOG_PC;
// Send only to the oPC who activated it (server message window) and the server log file
int LOG_FILE_PC_SERVER = LOG_TO_SERVER_LOG | LOG_PC_SERVER;
// Send to the oPC and all of their party members (floating text) and the server log file
int LOG_FILE_PARTY = LOG_TO_SERVER_LOG | LOG_PARTY;
// Send to the oPC and all of their party members (server message window) and the server log file
int LOG_FILE_PARTY_SERVER = LOG_TO_SERVER_LOG | LOG_PARTY_SERVER;
// Send to the oPC and their nearby (30m) faction members (floating text) and the server log file
int LOG_FILE_PARTY_30 = LOG_TO_SERVER_LOG | LOG_PARTY_30;
// Send to the DM channel and the server log file
int LOG_FILE_DM_ALL = LOG_TO_SERVER_LOG | LOG_DM_ALL;
// Send to all DMs within distance 10m of oPC and the server log file
int LOG_FILE_DM_10 = LOG_TO_SERVER_LOG | LOG_DM_10;
// Send to all DMs within distance 20m of oPC and the server log file
int LOG_FILE_DM_20 = LOG_TO_SERVER_LOG | LOG_DM_20;
// Send to all DMs within distance 40m of oPC and the server log file
int LOG_FILE_DM_40 = LOG_TO_SERVER_LOG | LOG_DM_40;
// Send to all DMs within distance 80m of oPC and the server log file
int LOG_FILE_DM_80 = LOG_TO_SERVER_LOG | LOG_DM_80;
// Make oPC whisper the message (chat message window) and the server log file
int LOG_FILE_WHISPER = LOG_TO_SERVER_LOG | LOG_WHISPER;
// Make oPC talk the message (chat message window) and the server log file
int LOG_FILE_TALK = LOG_TO_SERVER_LOG | LOG_TALK;
// Make oPC shout the message (chat message window) and the server log file
int LOG_FILE_SHOUT = LOG_TO_SERVER_LOG | LOG_SHOUT;
