Lots of my customers are getting emails showing their usernames and possibly a passwords they have used. The email then goes on to say that they have been “Hacked” and the hacker knows all about them. Of course the hacker then goes on to say that if you pay him he will make the information go away.

Basically ignore the blackmail attempt but do change your passwords as soon as possible.

The reason this is happening is that lots of large sites such as Facebook and Linkedin have had major data breaches over the last few years.
If you want to find out if your data has been compromised go to https://haveibeenpwned.com and enter your email address.
If you are still worried, contact me.