I was having the same problem and the key to all this mess is the AndroidManifest.xml
Tutorials on how to create your custom authenticator are kind of old (or at least pre Android Studio) so they state that you must copy the permissions, activity and service from the authenticator library to all the applications that are going to use the library THIS IS WRONG FOR ANDROID STUDIO because the Android Studio automatically merges the manifests from all modules.
If you are using Android Studio all you need to do is let the permissions, activities and service in the authenticator module and simply add a dependency to that module in the applications.
Here's a sample AndroidManifest.xml
<?xml version="1.0" encoding="utf-8"?>
<uses-sdk
android:minSdkVersion="8"
android:targetSdkVersion="18" />
<uses-permission android:name="android.permission.GET_ACCOUNTS" />
<uses-permission android:name="android.permission.USE_CREDENTIALS" />
<uses-permission android:name="android.permission.MANAGE_ACCOUNTS" />
<uses-permission android:name="android.permission.AUTHENTICATE_ACCOUNTS" />
<uses-permission android:name="android.permission.INTERNET" />
<uses-permission android:name="android.permission.ACCESS_NETWORK_STATE" />
<application
android:allowBackup="true"
android:label="@string/auth_app_name"
android:theme="@style/Holo.Theme.Light.DarkActionBar">
<activity
android:name="ro.muerte.modules.auth.MyAuthenticatorActivity"
android:exported="true"
android:label="@string/auth_action_login"
android:windowSoftInputMode="adjustResize|stateVisible"
android:clearTaskOnLaunch="true" />
<service
android:name="ro.muerte.modules.auth.MyAuthenticateService"
android:exported="true">
<intent-filter>
<action android:name="android.accounts.AccountAuthenticator" />
</intent-filter>
<meta-data
android:name="android.accounts.AccountAuthenticator"
android:resource="@xml/authenticator" />
</service>
</application>