Look at something called “Sound attenuation”. Just right click into your content browser -> go to the tab “Sounds” -> and then select “Sound attenuation”. Toy around with the options and if you are done with it move on to the next step. You can then set your newly created sound attenuation as a setting in your sound files directly (double click your sound) and select your previously created sound attenuation under the tab “Attenuation”, which is the last option in the settings of your sound file. You can also use a cue and set the attenuation there. If you don’t want to use that, you can also select a “Audio volume”, which can be dragged out into the level itself. It’s purpose however is more of creating static sound zones, instead of having a basic falloff of a per case basis.
Hope I could help you :).