Can someone explain/comment upon the "verification" function of Time Machine

Last night Time Machine presented me with a dialogue box--really a monologue box--informing me that I needed to "verify" my TM backup. Having spent a good bit of the afternoon on a crowded freeway coming back from Los Angeles, I was tired and foolishly said 'OK' rather than postponing the process until my head was clearer. After the 'OK' it proceeded to create a totally new backup of the HD on my iMac, a process requiring about 5 hours. Furthermore, all the previous backup files have vanished into the electronic ether. So, have I been screwed over by some trojan horse, or this an actual (but undocumented) function of TM and Time Capsule? There does seem to be a legtimate backup file, dated yesterday, but nothing from the preceeding three months.