Detailed studies have been carried out on an environmentally benign method for direct Friedel-Crafts acylation by carboxylic acids, using hydrated lanthanide triflates as catalysts. Reactions are typically performed in toluene over 1-7 days at reflux, using azeotropic removal of water. This work led to the discovery of an unusual transacylation reaction that occurs with acetate esters and carboxylic acids, producing new esters along with acetic acid. Aryl and alkyl esters were generally found to react in good yield; for example with octanoic acid, p-tolyl acetate gave an 83% yield of purified p-tolyl octanoate with a 27 h reaction time. Likewise a primary alkyl acetate such as 3,5,5-trimethylhexyl acetate gave a 79% yield of purified 3,5,5-trimethylhexyl p-toluate after 48 h reflux with p-toluic acid. The reaction failed with menthyl acetate and adamantyl acetate, however. We are at present studying the mechanism of the reaction, as well as scope and limitations.