Preheat your oven to 400°F (200°C).
In a mixing bowl, combine the ground beef, breadcrumbs, milk, egg, diced onion, minced garlic, salt, black pepper, and nutmeg. Mix well until all ingredients are fully incorporated.
Form the mixture into small meatballs, about 1 inch in diameter.
Place the meatballs on a baking tray and bake in the preheated oven for 15 minutes or until browned and cooked through.
In a large pot or Dutch oven, heat olive oil over medium heat. Add the diced potatoes and carrots, and sauté for about 5 minutes.
Pour the beef broth into the pot and bring to a boil.
Once boiling, add the baked meatballs and peas to the pot. Lower the heat and simmer for an additional 15 minutes.
Add the heavy cream and stir well. Allow the soup to heat through for a couple more minutes.
Serve hot, garnished with fresh parsley.