At one time a local law enforcement agency had M16s with a sheet metal piece between the lower receiver and pistol grip. That piece had a tail that extended up the side of the lower and physically prevented the selector from moving to the FA or Burst postition. It was too easy to defeat so they eventually pulled the auto sears and installed semi conversion kits.
In any case, the gun was still an automatic. I don't know about your situation but a part that could be called a "lock out" exists. It is possible it could be a legal gun and it is possible to inherit one legally. It is also possible to get extremely arrested for messing with it. More info is needed.