Clearly something severely wrong, isn't there? It indicates that something inside is binding (could be any number of things), and friction like that can only produce vast amounts of localised excess heat when the engine is running. A siezure or major failure is clearly imminent.
Agree entirely with the view "don't fly it" under any circumstances. Don't even let the club you borrowed it from fly it home. Ground it.
Get it stripped down and examined!