Rodel is correct, this is Game Play Error Severe. Why is shuffling in mulligan without showing unrecoverable? Because you can't get back that original hand. The opponent didn't see it. The player making the mistake may be 100% honest and accurate about there being a mulligan, but this can't be verified. The reason the rule says to show the mulligan hand is that a mulligan must be verified by the opponent before shuffle for simple fairness.
So, what would a judge do to 'continue the game'? That game should have started with that opening hand, but it is gone and unrecoverable. A judge could start a different game and make up some kind of penalty, but that is not fair to the opponent. The potential advantage gained by shuffling away a dead draw or a certain-donk hand is too much to allow a 'no-show' mulligan.
Of course, you don't go straight to the penalty. You want to hear both sides. You want to see if there is a hint of rules lawyering or trying to manipulate a game loss via the ruling. You should ask both players to tell what happened, starting with the player that called you over. You should closely question the opponent about what he or she was doing when the mulligan was being taken. You want to know if that person was watching and if so, what they saw or if there was any communication that acknowledged the mulligan. You want each person to describe the other players actions with the mulligan in detail. This is where you will catch out any mis-statements or overreaction to miscommunication.
If they both agree that the player did not show the mulligan, assess GPE severe. If there was a miscommunication that was the fault of the injured player, you might lessen the penalty. If they disagree on what happened, proceed to he said/she said determination (see the writeup of Mike Martin's excellent approach to this in the Judge manual).
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How 'bout preventing mulligans? We always teach "don't shuffle until you get your opponent's nod or 'OK' when showing your mulligan", when teaching players about mulligans. This sometimes comes up in pre-event announcements; it sets the expectation for the opponents behavior, too!