Police roll out crime scene tape outside Mark Madoff's apartment where Madoff was found dead this morning in New York, December 11, 2010. [Photo/Agencies]

A year ago, the trustee, Irving Picard, sued several relatives, including Peter, Mark and Andrew, accusing them of failing to detect the fraud while living lavish lifestyles financed with the family's ill-gotten fortune.

The lawsuit accused Mark Madoff of using $66 million he received improperly to buy luxury homes in New York City, Nantucket Island and Connecticut.

"This is a tragic development and my sympathy goes out to Mark Madoff's family," Picard said in a statement Saturday.

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Said Bernard Madoff's lawyer, Ira Sorkin: "This is a great tragedy on many different levels."

Calls to the FBI and US Attorney's office were also not immediately returned. Previously, spokespeople for the brothers had repeatedly denied that they had any knowledge of their father's crimes.

Bernard Madoff is serving a 150-year sentence at a federal prison in North Carolina. Bureau of Prisons spokeswoman Traci Billingsley said Saturday she didn't have specific information on whether he had been informed of his son's death or would be allowed to attend a service. In general, she said, inmates are informed of a relative's death as soon as the institution is made aware of it and the bureau does allow furloughs for prisoners to attend memorial services.

A police officer stood guard Saturday morning in the lobby of Mark Madoff's building, a 12-story luxury condo tower with a penthouse owned by rock star Jon Bon Jovi.

The building sits on a busy block abutting Broadway in an area crowded with clothing boutiques, cafes and art galleries. The sidewalks and cobblestone streets near the apartment were packed with Christmas shoppers Saturday, as dozens of reporters stood vigil.

Bystanders gawked as officials from the medical examiner's office removed Madoff's body early Saturday afternoon. The medical examiner will determine the cause of death.

Nikolay Reva, a 28-year-old salesman in the Prada boutique on same block, said that Mark and his wife would come in with their children to shop, both before and after the scandal broke two years ago.

Mark "was very sweet, respectful, friendly," said Reva. "But after his father's arrest, you could see the person diminishing slowly, you could see something started to happen physically, and he wasn't as talkative."