Lee's lawyer Davinder Singh told the High Court that a May 15 post by Roy Ngerng Yi Ling, a 33-year-old government health worker, contained statements that alleged "criminal misappropriation" by the premier.
Lee had earlier rejected an apology and compensation offer from Ngerng, who writes a blog called "The Heart Truths" which had more than 3,300 followers soon after the lawsuit was filed.
In general, civil suits are launched in the Singapore High Court when the value of claims is above SgD 250,000 (USD 199,000), according to guidelines posted on a government website. The court will have the final say on the amount to be awarded.
"The offending words and images, in their natural and ordinary meaning, meant and were understood to mean that the plaintiff, the Prime Minister of Singapore and Chairman of GIC, is guilty of criminal misappropriation of the monies paid by Singaporeans to the Central Provident Fund (CPF)," lawyer Singh wrote in a court filing.
GIC is a sovereign wealth fund that manages more than USD 100 billion of the city-state's foreign reserves. CPF is the state pension fund.
Ngerng has previously said the article was meant to call for greater transparency on how the pension fund is handled.
On Tuesday, he offered Lee SgD 5,000 as compensation but Lee immediately dismissed it as "derisory" and said Ngerng's earlier apology was "not and never meant to be genuine".
Lee also took offence at subsequent actions by Ngerng, including posting a YouTube video about his legal predicament and sending emails to the media that included alternative links to posts that allegedly carried "offending posts".
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