They give confidence to investors, which has led to national progress and prosperity, he said, in hailing their efforts as the Corrupt Practices Investigation Bureau (CPIB) marked six decades of stamping out bribery.
Mr Lee and his successor Mr Goh Chok Tong were special guests at a ceremony marking the occasion on Tuesday.
Mr Lee added in a statement: "We must remain vigilant and ensure that Singapore continues to be regarded as one of the least corrupt nations in the world, with a clean public service and businesses that abhor corruption."
Singapore has remained clean despite being in an area where bribery is endemic, he noted, and its challenge is to stay corruption-free. His mission when he became prime minister in 1959, he recalled, was to establish a clean and efficient government against such a corruption-ridden backdrop.
The CPIB had been set up seven years earlier by the British, but little was done because the CPIB lacked the necessary resources and legal powers, and corruption remained commonplace. So, then PM Mr Lee set about tightening the laws and entrenching a zero-tolerance stance towards bribery.
Wealth disproportionate to a person's earnings could now serve as corroborative evidence when a person was charged with corruption. Systems to ensure every dollar in revenue was accounted for were established. Instruments to prevent, detect and deter instances in which discretionary powers could be abused were sharpened.
"We... gave CPIB officers more powers of interrogation and to seize documents," he said.
Nobody was exempt, including the prime minister himself, whom the CPIB was directly under. If the head of government refused to give his consent for the agency to make inquiries into a case, its director could seek permission from the president.
The CPIB, which Mr Lee termed a "tenacious and effective instrument" against graft, has also developed a formidable reputation for thorough and fearless investigations. High-level government officials, including ministers, MPs, senior civil servants and prominent businessmen, have all been probed.
- By Leonard Lim, The Straits Times By Leonard Lim
BACKGROUND STORY
NEW FORMS OF CORRUPTION
The latest cases are new forms of corruption, with sex being exchanged for favourable outcomes. There is no end to human ingenuity.
- Mr Lee Kuan Yew
STAY VIGILANT
We must remain vigilant and ensure that Singapore continues to be regarded as one of the least corrupt nations in the world, with a clean public service and businesses that abhor corruption.
– Mr Lee Kuan Yew
PM LEE HSIEN LOONG ON...
HOW SINGAPORE HAS BENEFITED FROM A CLEAN SYSTEM
Our people and our companies have a reputation for honesty, reliability and trustworthiness.
Our system overall functions properly because policies are developed for the public good rather than private or vested interests. Singaporeans know that they can make it if they work hard, whatever their family backgrounds and regardless of their personal connections.
HOW ALL HAVE A ROLE TO PLAY
Keeping Singapore clean goes beyond the public service. The political leaders have to continue to set high standards of honesty and integrity.
The society must continue to reject corruption, not just because of the rules and penalties, but because this reflects the society we want to live in, and the values that we uphold and hold ourselves to.
Highlights over the years
1952: Singapore's first independent anti-corruption unit is established.
1960: The Prevention of Corruption Act (PCA) is enacted to prevent corruption more effectively. Corrupt Practices Investigation Bureau (CPIB) officers are empowered to investigate and arrest offenders. The PCA is amended over the years to enhance punishments for offenders and give officers more investigative powers.
1968: The bureau comes under the Prime Minister's Office.
It was previously parked under the Attorney-General's Chambers and the Ministry of Home Affairs.
1975: The CPIB reveals that then Minister of State for Environment Wee Toon Boon is charged with corruption involving over $800,000.
1986: Then Minister for National Development Teh Cheang Wan investigated for corruption. Teh dies during investigations. He leaves a letter for then Prime Minister Lee Kuan Yew, published in the 60th anniversary book.
Members of a syndicate found to be fixing the local 4-D lottery draw are arrested and convicted. The syndicate tampered with the lottery-drawing device for guaranteed winnings.
1995: Then Public Utilities Board deputy chief executive (operations) Choy Hon Tim is charged in court for accepting bribes totalling $13.85 million - the highest graft amount in the CPIB's history.
1996: The bureau starts to conduct its own basic training course for newly recruited CPIB officers, instead of relying on the Police Academy.
2004: A computer forensic unit is set up to examine computer-related evidence. CPIB flag also commissioned.
2007: Wang Xin, the team manager of S-League club Liaoning Guangyuan football club, is investigated for match-fixing. Seven players are charged and jailed. Wang absconds while on bail.
2009: Top chefs from several popular restaurants are found guilty of receiving commissions from a seafood products supplier who "encouraged" the chefs to purchase seafood from his company.
2011: The CPIB investigates 138 graft cases, a seven-year low. The majority (75 per cent) are from the private sector.
DEC 2011/JAN 2012: Investigations into sex-for-contracts cases involving the chiefs of the anti-narcotics bureau and the Singapore Civil Defence Force, Ng Boon Gay and Peter Lim, begin. Both have been suspended. The court trial for Ng starts on Tuesday.