Details of more than 250,000 X Factor entrants are said to have been stolen and Simon and bosses at American TV network Fox, are said to be scared that the thieves will use the details to make money.
An official investigation has been launched and an email, which was seen by the Daily Star, was sent to all contestants to warn them about the security breach.
It read: 'This week, we learned that computer hackers illegally accessed information you and others submitted to us to receive information about The X Factor auditions.
'It is possible that the information you did provide to us, which included your name, email address, zip code, phone number (which was optional), date of birth, and gender, may have been accessed.
'We are taking this matter very seriously and are working with federal law enforcement authorities to investigate this illegal action.
'The X Factor will never ask you to email personal information such as financial data, credit card numbers, Social Security numbers or the user name or passwords you use to access other websites.
'If you receive an email that appears to be from Fox.com or The X Factor asking for personal information, please delete it, as it did not come from us.'
The network confirmed that no financial information was accessed.