E. Cobham Brewer 18101897. Dictionary of Phrase and Fable. 1898.
Money given to free-booters by way of exempting property from depredation. (Anglo-Saxon, mal, rent-tax; French, maille, an old coin worth 083 farthing). Grass mail was rent paid for pasturage. Mails and duties (Scotch) are rents of an estate in money or otherwise. Black in this phrase does not mean wicked or wrongful, but is the Gaelic, to cherish or protect. Black mail was a rent paid to Free Companies for protecting the property paid
for, from the depredations of freebooters, etc.
To levy black mail now means to exact exorbitant charges; thus the cabs and omnibuses during the Great Exhibition years levied black mail on the public.